As such, planning ahead and working with a cost segregation firm that is highly experienced with 1031 exchanges is key.Definitely reach out to your CPA and/or certified cost segregation professional. 

A unit renting for $700 probably can't go straight up to $1,200 overnight with no updates unless your property looks like the other ones in the area renting for $1,200 and offers similar finishes/ amenities. 

I plan on using the BRRRR method.I live in Jersey City, NJ, and the home prices are very high in this area.

Seems to me that at scale, a portfolio like Luka's would indeed build wealth over time and open up options to transition into higher quality appreciation markets several years down the line, with the benefit of more capital and (more importantly) more experience.

Freddie Mac and Fannie Mae, kind of like special lenders, offer good rates but need well-kept properties with lower down payments and longer payback times.

It's a product offered by Lead Propeller and am curious if anyone has tried it. 

If you are not planning on living there too, you would only be able to offer a gift to that person and you would likely not qualify as an eligible gift donor unless you are closely blood related. 

I offered not to raise a rent and if they extend, they could cancel any time to buy their house.

@Matthew Samson, I highly recommend that you look into the investment strategy of rent-by-the-room.

I will show them how to make certain repairs in a hands-on way as part of this field trip.I am thinking about charging $500 for this offer.