Be wary and seek advice about everything before you dive into the deep end.       

You’re neck deep in Paralysis of Analysis, a virus more debilitating than the Spanish flu, Bubonic Plague, and the latest virus du jour, Covid.I’m no different than you. . .well, I’m Italian, so I’m a better cook and I have three Uncle Tony’s who collect my rents.

There is also the local knowledge of a market like here in Lake Tahoe where lending can be trickier so an offer with a local lender might get chosen because they have a reputation to get a deal done vs a national lender that can have more red tape and a slower process. 

Just make sure to document how you arrived at the land value in case of IRS inquiries.If you’re unsure or want to avoid any red flags, consider consulting a tax professional to ensure you’re compliant and optimizing your depreciation. 

Also remember the time these returns will take to amend along with the possibility of opening up audit periods/red flags with the IRS due to amendments.Doing this yourself on turbo tax likely won't be your best bet considering all of the details.

Similarly if you feel the material pricing is marked up by too much, that's similarly a red flag.

For example my simple spruce up would be, renno bathroom, and kitchen, paint, and redo carpet upstairs.But if i think real deep into what I could do to make it a STUNNER then I think, knock down walls, create more open/broken floor plan, add central air, possibly do an addition to add a 3rd bedroom and second bath.So when you could do ANYTHING .. how do you draw the line of what you should do?

So if you have deep enough pockets I'd hold the property for longer and refi into a conventional loan if possible.

@Chris SeveneyI agree the sponsor is the most important factor, but passive investors can not ignore what they are trying to accomplish, and have a deep understanding of the business.The trinity!

Quote from @Adriana Collado Hudak: Hi Jason - I did a deep dive into turnkeys and MidSouth Home Buyers checked off all the right boxes.