My plan is to live in the duplex for the first year as required by my loan and then rent out.   

The good thing about Texas is that the state does not have a state income tax.The only potential filing oblgation that you can have with Texas is if you have an LLC and therefore required to file a franchise tax obligation.

Hi Alexander, On a full documentation loan, lenders will allow up to a 95% combined loan to value on a primary residence assuming income is strong enough to support your debt to income ratio and reserve requirements are met. 

There was no financing required, since we were assigning the deal to a buyer.

Even though it's one loan (and if you use FHA financing a low interest loan at that) FHA parameters view it as you owning two properties - one your primary and one an investment property.When you sell, if you have met the residency requirements of the primary side you will get that gain tax free up to the 250/500K limits. 

Here are some key points to consider:Accessibility: Residential properties are often more accessible to individual investors, especially those starting out with smaller capital.Tenant Stability: While turnover can occur, residential leases tend to have shorter terms, offering more flexibility if you want to adjust rents or change tenants.Market Liquidity: Generally, residential properties are easier to buy and sell due to higher demand from individual homebuyers and investors alike.Emotional Appeal: Homes and apartments can have a strong emotional appeal to buyers and renters, which can influence demand and pricing stability.Purchasing: Residential real estate will require a down payment of at least 10% of the purchase price. 

If you hold out a section of the home strictly for personal use that part will not count towards your 1031 reinvestment requirements. 

Here’s a detailed breakdown of these two types of markets and the factors that contribute to each:Cash Flow Market, a cash flow market is one where rental income exceeds the expenses of owning the property (mortgage, taxes, insurance, maintenance, and property management), resulting in positive monthly cash flow for the investor.Key Characteristics:High Rental Yields: Properties typically have high rental yields compared to their purchase prices.Stable or Slow Appreciation: Property values increase slowly over time, if at all.Lower Property Prices: Generally, property prices are lower, making it easier to achieve positive cash flow.Higher Rental Demand: Strong demand for rentals due to economic factors, demographics, or local employment conditions.Factors Contributing to Cash Flow Markets:Economic Stability: Stable job markets and steady local economies that support rental demand.Rental Market: High percentage of renters compared to homeowners.Affordability: Affordable property prices relative to rental income.Local Policies: Landlord-friendly laws and regulations.Appreciation Market, an appreciation market is one where property values increase significantly over time, offering substantial capital gains upon sale, but rental yields may be lower, resulting in lower monthly cash flow.Key Characteristics:High Property Value Growth: Significant annual increases in property values.Lower Rental Yields: Rental income may not cover the monthly expenses, leading to lower or even negative cash flow.Higher Property Prices: Generally higher property prices, which can make it harder to achieve positive cash flow.Strong Economic Growth: Rapid economic growth, population influx, and development.Factors Contributing to Appreciation Markets:Economic Boom: Strong local economy with job growth and high-paying industries.Population Growth: Influx of people moving to the area, increasing demand for housing.Infrastructure Development: Significant investments in infrastructure, amenities, and services.Desirability: High quality of life, good schools, and attractive neighborhoods.I hope this information finds you well. 

An Attorney will help with creating an LLC.LLC is not required, may make getting financing more difficult.It may provide some asset protection.Most of the asset protection that you need will come from the insurance policy.Discuss with the insurance agent on situations that you are not protected.Have a discussion with an attorney if your extra concerns can be protected through an LLC.

Having a license doesn't bestow magically knowledge on yourself.Most brokerages require that you complete a certain number of transactions under the guidance of other agents for a reason.