The "land basis" cannot be depreciated, so your depreciable portion will be lower than $350k.We typically consider $1 million in building basis as a rule of thumb where it makes sense to evaluate the potential benefits.

For our second STR, we are currently researching Sherman, potentially / ideally, a less expensive duplex that we could rennovate and self manage from Dallas with workers coming to the area in mind. 

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

For southern states, you might want to look at smaller markets in Alabama, Mississippi, or parts of Tennessee and Arkansas where properties are still affordable and cash flow potential exists.

Potential cash flow How did you find this deal and how did you negotiate it?

I've never done any Sacramento STR loans and only been hit up for one potential financing opportunity there.

If the stars align, we estimate that we could potentially earn $1,000 to $1,500 per year from the property.

There's so much growth potential in Columbus Ohio and the best way I can characterize this market is it provides good positive cash flow but amazing appreciation potential.

Is saving the fee a PM charges worth the potential thousands in cost and headaches?

., Purchase Price: $475,000 ($197.9/sq. ft.).Estimated Market Value: $402,000 ($168/sq. ft.).Financing Terms: 2% interest rate, with a 9-year balloon.Unit B Income: $2,049/month (Section 8 tenant through November 2025).Unit A Income Potential: Similar rent or higher; Section 8 cap for the area is $3,234/month.Monthly Loan Payment (P+I): $1,386.Cash Flow Breakdown (if both units are rented at $2,049/month):Gross Rent: $4,098/month.Vacancy (10%): $410/month.Operating Expenses (37.3%): $1,376/month.Net Cash Flow: $943/month.Key QuestionsWould you be comfortable paying an 18% premium for financing at 2%, especially in a market where current mortgage rates are closer to 7%?