It was a subsequent post in response to my question that OP made clear it was because the state required deposits to be held separate.  

If he rents it out for 5 years, he now has to pay capital gains tax on that $300K (and any subsequent appreciation). 

.: You are right to be worried I know a good number of people who sold and subsequently lost their money over time in bad investments.

In each case there is a fee for the first year (something like $20K and $5K, respectively), and then the renewal fee for subsequent years is much lower. 

The other book you mentioned caters more to that audience and gets people hooked on the idea that they can invest in real estate with no money and then teaches them how in subsequent books. 

Perhaps you do things differently with your subsequent purchase or your next management company. 

Overall CoC would be 4288 / ($8,735 + $7,976) = 26% +/- a few basis points account for cost of capital.By adding just one more investment we see a 6% increase in total CoC with only a 4 month additional lead time to full collection (negligible impact from time-value of money) and a ~6.5% increase in yield for the subsequent investment.Final ThoughtsFollowing the math suggests that doing more short-term investments makes the performance metrics exponentially better over time, and on their own their own they are still akin to modest although not Earth shattering returns.I add these details from the context of being a Tardus client for the past year.

Project phases typically divide payments into an initial deposit and subsequent installments.Depending on the project scope, you can divide the payment into milestone payments.

However, these costs can often be added to your property's basis, which helps reduce capital gains tax when you sell the home.Once the property is officially a short-term rental, subsequent repairs and maintenance would likely qualify as deductible expenses. 

A subsequent cash-out refinance of the replacement property (e.g., $250K on a $1M property with a $500K loan) is treated as a loan and generally has no tax implications related to the 1031 exchange.