Before the income subject to UBIT is calculated you can depreciate and deduct expenses and losses on that portion of the income so generally it's not as bad as people think. 

I think you are just having bad luck with tenants on this one.   

@James Wise you're right about California's bad leadership. 

The real property investment can be repositioned if it proves disappointing in its original form; it can be refinanced or recapitalized if it has too much or too e pensive debt; inflation over time bales out many bad purchases, and finally the investors knowledge, experience and abilities can be leveraged to turn around a cash flow negative property.I’ll provide an exampleThree years ago we purchased a note from a bank secured by two auto repair facilities with a large amount of excess land.  

And like you said one out of 10 thats not bad.. maybe you just got that bad tenant it happens to very landlord. 

Just hope it's not to bad.  

This is good for building but bad from a competitive entry standpoint.  7. 

Wholesalers drag out the process if you go with a bad one. they are not buying the house. they only want your signature.

Honestly if the property taxes are enough to make the rentals a bad deal I’d suggest selling.

I specifically want to call out one of their Senior Accounts Associate, Charlotte Cunningham, who helped me through the process on my first purchase as I needed to buy a sizable amount of furniture quickly and she was able to help me make moves quickly...and didn't make me feel bad whatsoever when I pulled back a few items at the last minute I was able to find them cheaper elsewhere.