However, capital gains tax (if not exempt) and transaction costs could eat into profits.Cash-Out Refinance- If rental income covers both mortgages, this could scale your portfolio faster—but be cautious of higher mortgage payments and interest rates.If you have any other question, send me a DM or email!

For many homeowners, particularly the elderly and those on fixed incomes, this cap can provide much-needed relief from what has been described as a “backdoor tax increase” due to rising property valuations [5].Long-Term Benefits and Potential DrawbacksWhile the immediate benefits for current homeowners are clear, there are several long-term implications and potential drawbacks to consider.

You need a designer who understands maximizing income on properties, or you need to understand it and be able to sketch it out. 

Loopnet has some comp information, but requires a paid (and not cheap) account to see it.Commercial properties are generally valued based on income, not comps per se. 

You may be required to make estimated tax payments when the property sells.It depends on what your 2024 total taxes due were and 2025 estimated total taxes / withholding / estimated payments are.If you pay in atleast 90% of the current year tax or 100% / 110%(Depending on 2024 income), you are normally considered good.You may want to consult with an accountant for more clarification.

@John Zhang If your wife qualifies for Real Estate Professional Status (REPS) and materially participates in managing rental properties, there is no limit on the amount of rental losses, including depreciation, that can offset your W-2 income.

Hello Devon,You can buy a new duplex with 5% down if you are living in it.You can use expected rental income to qualify.

In Texas, there’s no state income tax on rental income, but LLCs have formation and annual fees.This post does not create a CPA-Client relationship.

Everything I bought is up 2-3x and last year I had net rental income on my taxes of $86,000.

Here's the deal:Purchase Price (PP): $95kRenovation Budget (via HML): $60kTotal All-In Cost: $155kARV (After Repair Value): Around $200kRefinance (via DSCR Loan): 7% interest, 30-year fixedRefinance Details:After the refi, I will pay back the Hard Money Loan (HML) at 11.95% with 3 points:HML: $60,000Interest/fees: $3,585Other costs: $1,800Total to pay back HML: $65,385After the refi, I will have $84,615 left in cash.Cash Flow & Expenses:Expected Rent Income: $1,700/monthProperty Management (PM): $126/monthInsurance: $100/monthTaxes: $126/monthMortgage: $1,043.75/monthTotal Expenses: $1,395.75/monthSo my monthly cash flow is about:$1,700 - $1,395.75 = $304.25/month in cash flow.Return on Investment:Cash Invested After Refi: About $18,385 (after paying off HML and closing costs).Annual Cash Flow: $304.25 * 12 = $3,651Cash-on-Cash Return (CoC): $3,651 / $18,385 = 19.8%I didn’t account for maintenance costs since it’s a full gut rehab, and everything is brand new.