He became a contractor, worked hard, and grew a successful business that produced a lot of money.

To maximize your tax advantages, treat 75% of the property as rental income-producing, allowing you to deduct expenses like mortgage interest, property taxes, and depreciation on that portion.

China as a low cost producer is past- they have aged and standard of living out.  

Ok, just wanted to make sure this was normal procedure. 

I'm a local real estate broker, investor, and manager (100+ rentals, mostly Airbnb/STR and multifamily).House hacking is a tried-and-true method and in Sacramento you can produce some meaningful income while enjoying the appreciation and tax benefits of owning real estate.

I would rather invest in safe markets that produce a good return, then I can use that income to pay for a vacation anywhere in the world.I'm very pessimistic about the STR market in Hawaii.

Real estate is basically an income producing and or capital gain producing investment.  

That means having procedure and protocol for every situation--or at least, every common situation. 

If you are using STR, REPS, or self rental with material participation to convert to active or nonpassive income, you do not have to do this if you have passive business invesment that produce passive income that will exceed the loss generated by depreciation.

They don't understand how to price effectively, study the market, set boundaries with tenants, establish policies and procedures, communicate, and dozens of other things.