No, you cannot create phantom losses this way.Some additional issues that we have not addressed:- holding rentals inside an S-corp has many tax disadvantages- you will likely jeopardize your $250k/$500k capital gain exclusion for homesteads- you will lose asset protection afforded to personal residences by most states- you will lose your homestead exemption for local property tax - your insurance will have to change from owner-occupied to rental, i.e. go up- and there's moreConclusion: there're reasons why nobody is doing this clever "strategy" but A+ for trying.

Reach out using the message system if you have any direct questions or want additional advice.  

Additionally, the price point is still cheap enough to find the 1% rule and positive cash flow and there's amazing appreciation potential.

In addition to Wishing Well Hills, Decatur, Brookwood, and Smyrna/Marietta, you might also look into Powder Springs, Austell, and parts of Douglasville, as they offer more affordable options with solid rental markets.

Additionally, forming a new LLC may require obtaining a new EIN and business bank account.This post does not create a CPA-Client relationship.

In addition, you would need enough working capital to pay for insurance (which will be going up a LOT in Los Angeles) and to pay for property taxes.Don't buy this unless you have substantial resources and a cash cushion to keep yourself safe.

If they’re underfunded, you could get hit with special assessments.Not sure about the exact contract with the tenants, but I assume if there is any additional assessment, it would be tenants’ responsibility.Since you want to stay local and focus on cash flow, commercial makes sense, but have you considered industrial or flex space? 

In addition to reviewing the numbers, take time to tap into your intuition (through meditation or other method) and your gut will help you make the right choice.

There are cheaper one’s in D/F areas but I would be careful as those can create a laundry list of additional issues.

If we waited 12 months and got up to 80% occupancy would have netted an additional $500,000.