I know people sell occupied rentals but I don't really want to discount it and for the price that I'd list it I'm not sure it would be an attractive investment for someone else.

Conversely, this means that Property 2 has less risk, which makes it more expensive per dollar of NOI produced.

So for syndications the accelerated depreciation would be offsetting qualified dividends rather than ordinary.But since the distributions form a small fraction of the total gains from the syndication (most of the gains are ltcg), chances are high that accelerated depreciation from the next deal will offset a big chunk of ltcg from the exited deal, irrespective of whether the distributions during the hold period were treated as ordinary or qualified dividends.I agree that most people don’t look at depreciation as a loan/subsidy by the govt, maybe because their ego doesn’t allow them to admit that their investment would not produce competitive yields without subsidies or maybe because they don’t understand the entire value chain. 

Does it produce cash flow?  

This implies you need to find good investment properties that produce better initial cash flow than the average purchase. 

I am now getting my first home and iwant to airbnb the bottom half of the home and fix it up nice to attract high quality travelers.

Thank you for your response @Sam Smith , so I’m still trying to learn what makes a deal a good deal, I don’t want to blindly invest money into something that will produce a negative cash flow.

To answer some of @William Collins’ questions and give more insight here’s the plan:I don’t have a ton to put down now which is why FHA is attractive.

I suppose that's what I mean when I say I want access to the capital now, because I can invest in a way that produces now with cash flow and appreciation and even more later by using leverage, 1031 exchanges, depreciation, etc. 

But I feel you'll get steadier numbers near year round attractions.