It works just fine if the operator knows what theyre doing and structures it correctly.

An experienced broker with lots of choices at the palm of their hand is probably the best bet.

Rent Per Unit $‎650 $‎700 Other Income $‎750 $‎800 Less Vacancy $‎(3,120) $‎(3,360) Operating Expenses $‎18,790 $‎19,809 Repairs $‎4,000 $‎4,200 Capital Expenses $‎2,000 $‎2,100 Landscaping $‎1,500 $‎1,575 Utilities Vacant Units $‎288 $‎302 Property Taxes $‎6,000 $‎6,300 Insurance $‎1,500 $‎1,575 Management $‎3,002 $‎3,232 Other $‎500 $‎525 Net Operating Income $‎41,241 $‎44,831 Financing Expenses $‎22,224 $‎22,224 Cashflow $‎19,017 $‎22,607 Down Payment $‎21,000 $‎21,000 Cash on Cash Return 90.55% 107.65% Keep in mind, this return doesn't even include the principle pay down on the loans.

How do you plan to operate it?

Does the operational company already exist and have income history?

Melanie:You say I sound like an operator, but you may have missed that I'm talking about my PASSIVE investments.  

Supplement this far simpler entity approach by ensuring you have appropriate types and levels of insurance, you operate your business in a manner in which your conduct is not considered an exclusion in your policy, you work with licensed and insured vendors, you execute contracts with indemnification clauses with these same vendors/ require additional insured status &  maintain appropriate licensing and permits.

All depends on the operator, the segment there playing in. 

Hey @Sara Valentine,It sounds like this is a common problem with many other STR and MTR operators locally and across the country. 

I added a pool and did some landscaping and have been using it as a family winter retreat and renting it to a STR operator the rest of the year.