Scrape and rebuild has also worked over the last few years too.IMHO multi-family lies lower on the risk scale as higher rent/appreciation ratio ie higher percentage of your return is in your hand (but taxable).

Personally, I prefer the refinance and hold strategy because loans are not taxable and after a refi you still have an asset!

My name is Andrew, a current investor/blogger looking to start building my assets and reducing my liabilities (I'm fresh off the book "Rich Dad, Poor Dad")I currently work at a company that offers a very handsome "homebuyers program" which offers about $30,000 to be allocated towards the purchase of this across 10 years of "bonus money" (which becomes taxable income) ($7500 upfront total and $2500 for the 9 years after) allocated to employees as long as they meet these three conditions:1.

If you start lending money and earning interest, isn’t that all taxable at ordinary income tax rates?  

You should look how much taxable income the property would generate (after depreciation) and see:1.

If I take my proceeds from the hypothetical sale and stick them in a low risk non-RE investment, I might clear 3% gains, at best, taxable and with no depreciation to offset them.If a good opportunity comes along after the property has seasoned, I could always have it reappraised for FMV and pull equity out, assuming I don't just sell it then.You make a good point, but that was my thought process.

Separate question, what about the fact that wells would only recognize the salary from my 9-5 and not my total taxable income from the tax return?

Having the seller hold a second is one strategy I use for myself and clients but also remember sometimes that the seller will use that as leverage back and the price or your demands.Also realize that the first lender has to approve the seller holding a second for you.Some of then will not or will only let them hold a certain percentage and want you to put a certain amount down (skin in the game) so they lender feels you will fight for the property to keep it performing when if gets tough.Even if this property is performing it could have a bunch of deferred maintenance which is why the books have looked so profitable all these years.If you get hit with immediate capital costs in repairs today and in the next few years it can suck away all your projected cash flow and put you in a loss situation.Great if you want a loss to lower your taxable income base but not so great if you are buying it for cash flow.

The asking price is 330k, tax rate is 2.65%, I've been told taxable value's is 80% so calculating for that.

Which begs the question, if you are already finding the deal and arranging investor financing why not attempt to carve out a portion of the long term proceeds and enter into a ‘no money down’ investment deal rather than simply trading your value for a quick (taxable at earned income rates) payday?