The commission will likely call this PM to notify them of the complaint and see if there's a way to resolve the issue before opening an investigation.

In your theory, they are both worth the same, but if you would have looked at the cap rate, you could have saw a red flag that would have caused you to investigate further during your due diligence.

This is investigated by the FBI, there are monetary and jail penalties.

That would need more investigation if I were truly considering this property - this exercise was mostly learning how to plug in the numbers and interpret the results.Yes, I'm projecting the property to be STR. 

To find out if a place has these laws, talk to local property managers.The metro areas that remain are the ones to investigate further.Operating Cost ComparisonSince you mentioned Texas, I compared property taxes and insurance costs in Texas and two other no-income tax states.

However, if your area does not have investment properties that fit your strategy, then investigate another market that does.  

I have found a few older homes built in the 70s while driving for dollars, and today just found something on the MLS built in 1936 that I may investigate.

I have investigated the buildings (in pretty good and turnkey shape) and the local rental market and it is not bad.

I'd investigate that angle first.If permits were issued, then it seems to me that the county gave the OK and maybe there was a variance granted.You can do some investigation on your own, but you'll probably need to get a savvy real estate lawyer involved at some point.

I also have been scheduling a walkthrough on their move out day, clearly stating that it is a preliminary walkthrough and that not all security deposit charges will/can be identified at that time.