Hi Amanda,I recently converted a mid-term rental into a Sober Living.

We have it under contract $30-50/SF under recent single family comps, so worst case we convert it back at exit and still cash flow in the meantime as a rental.

These loans are typically secured by real estate assets and can be repaid once your cash flow improves.Mezzanine Financing: This combines debt and equity financing, allowing you to borrow the needed funds with the option for the lender to convert debt into equity if not repaid on time.

The were clearly mansions at time of construct, and now converted small multi's all sec8. 

However since the accumulated passive losses ultimately do end up on 1040 as losses they do get converted to active losses.

- Should I invest $40K into converting my parents’ single-family home into a three-family, even though the immediate return might only be a few hundred dollars a month?

Additionally, the limited rental period may not significantly impact the gain, but it’s essential to confirm whether any prorated exclusion applies or if the IRS rules regarding converting a primary residence into a rental property could affect the tax owed.

If property values are stable or increasing, your strategy might be solid.Exit Strategy Since you plan to refinance in 12-18 months, consider what happens if interest rates don't drop or if refinancing terms aren't favorable at that time.Questions you might want to askAre there any zoning or regulatory issues with converting or renting the units as mid-term rentals?

Hello BP community,I’m currently exploring the possibility of converting a single-family home in Philadelphia, which is zoned RM-1, into a multifamily property.

I converted my STR to a LTR because the climate here in the Springs (and CO in general) is so hostile to short term rentals, and it's getting worse.