@David Woodside The 500-hour rule allows you to treat rental losses as active, enabling you to offset other income and reduce your tax bill significantly.

The state laws (do not quote me) appear to not let these companies increase rates (or its not easy) to pick up the losses.

Itemized breakdown has ridiculous amounts for damages, thefts of toolboxes, medical claim, loss of use etc.

These agencies began calling me non-stop, demanding I fix the heater immediately and provide the tenant with hotel accommodations during the repair period—or else I’d be issued tickets and face daily fines.I won’t go into detail about how I feel, but anyone in my situation would feel like they just swallowed a bitter pill.

@Roy Kinzer Rent control in NJ can be a tough pill to swallow and unfortunately has caused many of my deals to fall apart quickly once buyers/future landlords realize how strict the controls can be.

No, it would be a total loss.

Is the cash flow loss a lot less than than the equity and what is the plan to be cash flow positive? 

Most are being encouraged to buy Class B-minus rentals and below, but no one corrects them about their mistake of using Class A assumptions on these rentals:When a newbie gets smacked with reality via their losses, they then can only suck it up until time improves their mistake or dump at a loss.So, my question is, why can't we all do better and grow our industry with integrity?

Keep in mind it is a risk and speculation, if something happens(market tanks, job loss, etc) then you will be out money.

I would consider adding loss of rents coverage.