Let me give you an example of how these deals are structured:Seller wants to sell their property, but for various reasons (including cap gains taxes, low ball offers from cash buyers) they prefer to seller-finance their property instead.

.### Calculating ROI- **Total profit (not accounting for costs like maintenance, taxes, etc.):** Total amount received - initial investment = $601,816.40 - $235,000 = $366,816.40.- **ROI over 30 years:** ($366,816.40 / $235,000) x 100 = 156.09%.### Calculating Annualized ROI (CAGR)The formula for CAGR (Compound Annual Growth Rate) is:\[ CAGR = \left(\frac{Final\ Value}{Initial\ Value}\right)^{\frac{1}{Number\ of\ Years}} - 1 \]In your case:\[ CAGR = \left(\frac{\$601,816.40}{\$235,000}\right)^{\frac{1}{30}} - 1 \]Let's calculate this:\[ CAGR = \left(\frac{601816.40}{235000}\right)^{\frac{1}{30}} - 1 \]\[ CAGR = (2.56)^{\frac{1}{30}} - 1 \]\[ CAGR \approx 1.0303 - 1 \]\[ CAGR \approx 0.0303 \text{ or } 3.03\% \]This means your annualized return is about 3.03% each year over 30 years.

It may not be here tomorrow, and taxes won't matter then.That said, if you're trying to estimate your future tax benefits, keep in mind these things:- depreciation is only applicable to rentals- depreciation starts when you place the property "in service," not when you buy it- depreciation increases your deductions and consequently your tax losses, but you may or may not be able to benefit from these losses, depending on your overall tax situation- if you do have room for additional depreciation, you may be able to amplify it with cost segregation (a separate topic) 

e.g. absentee, tax liens, probate, compliance issues, or simply overgrown / abandoned.

(permitting, taxes, etc)

Separate accounts make tax time easier, showing you as a skilled investor.

Depending on one's risk tolerance, you can get very good returns and still benefit from real estate's tax advantages as a LP.

Initially I was planning to establish an LLC for liability protection, but after several consultations with different law firms, entity structures seem more complicated and much more expensive than what I need just starting out and with and no real wealth to protect. 

Let's say Taxes are $200/month, and Insurance is $150, and you put $100 in a maintenance reserve.  

I can also consult that friend who does construction full time now.