Things will get “complicated” if you try to buy more than 3 replacement properties.I don’t see a problem with her renting you a space in her commercial building as long as she charges you “fair market rent”  (then she could leave the property to you at her passing.)

Additionally, it can help maximize renovations and improvements.A Cost Segregation study is an IRS approved federal income tax tool that increases near term cash flow by utilizing shorter recovery periods for depreciation to accelerate return on investment.

I've done over 75 flips in the past 3 years, we manage 300+ doors, and I own 28 long term rentals. 

If you want to avoid the lengthy process of securing permits and navigating ordinances, you can always opt for long-term rental for the first year.

I own a two long term rental in the Pacific Northwest and one in the Midwest.

The other advantage the California investors have is that their equity goes a long way in another area.  

Matt, any strategy can be smart or a good idea as long as you understand and are ok with the risks.Going out of state is higher risk than staying in your local market.

Usually the depreciation is enough to shelter your income so that you pay little to no tax, at least on a new long term rental. 

But my short term rentals are for people working at a refinery, not people vacationing.My logic is this: most of the people I'm renting to are accustomed to getting screwed out of their money one way or the other. 

That's a long time, but what's the average DOM for similar properties in your market?