We plan on returning 2 STR permits because the STR revenue has not exceeded LTR revenue by enough to justify either the additional costs or if self managing the additional effort. 

As of now , they have the land , the permits and city approval to build the houses.

The rehab depending on the size again may be more like 200K with repiping, I did a remodel last year 1500sf, and needed a roof, panel, all siding, full interior redo and permits it cost us 218K3.

Hey everyone, I’d love to get your thoughts on structuring an equity waterfall for a two-phase capital raise.We’re raising in two phases:•Phase 1 ($600k now): To acquire the property and complete permitting.

We have a small payment left on the contract which I am withholding until completion.We did have to get permits and the city inspector has added work at every inspection so that has caused distractions (necessary ones) along the way.Our visit to site today was more of the same, I immediately reached out to the GC with photos of every space - interior and exterior - asking how they can claim we will be done in a week when we are clearly not that close. 

Successful flippers are:- Building relationships with reliable contractors- Ordering materials well in advance- Being strategic about which renovations will truly deliver ROI Regulatory EnvironmentRecent changes to Phoenix building codes have emphasized:- Stricter energy efficiency requirements- More rigorous inspection processes- Additional permits for certain types of renovationsBe prepared for longer permitting timelines than in years past.Financial ConsiderationsThe financing landscape has evolved significantly:- Hard money lenders are offering more competitive rates (7-9%) than the 12-14% seen in 2022- Several Phoenix-specific investment groups have emerged that pool resources for flips- Traditional lenders now offer more renovation loan products tailored specifically to the Arizona marketThe Bottom LineThe Phoenix market in 2025 offers solid opportunity for house flippers who approach projects strategically.

Since I'm a contractor and we will be living in the property it will be easier to pull permits for the work.

Generally, Treasury Regulations section 1.469-4 permits grouping of activities in your real estate portfolio to meet the material participation requirements, but if you elect to group then these activities must exceed 500 hours and there are special rules for which activities can be combined and minimum participation for each group activity. ...

Legal Implications & Ramifications : As an example; the iconic PCH homes in Malibu and many in the upper foothills might not permitted to build back, certainly not to the same extent or materials.

The reality is that imposing expensive and time-consuming sprinkler installation requirements will drive property owners to either scale back necessary renovations or avoid permits altogether.Currently, when owners propose substantial renovations, they are often informed that their projects will require sprinkler systems, which can cost around $45,000 for a typical three-decker.