It basically makes everything tax-free because the annual gross profit is below 2% of purchase price for properties I'm looking at.

I think I can build all of that out using portable sheds as shells for about $75,000 and then if they rent for $100 per night only 8 nights a month that would still gross $4,000 a month ($48,000/year) and the ROI on that would be better than 5% per month.

The end result was an $800/month increase to gross rents and approximately $300/month reduction in operating costs, yielding just over $11,000/year in increased NOI to $35,784. 

These are his "actual summary" Gross Annual rent is $22,332.Vac Loss $1,116.Effective Gross Income $21,216Property Taxes $990Operating Expenses $5,238Total Expenses $6,228Net operating Income $14,988The 2nd property is $495k - 3 units (2 -2/1 & 1bdrm) These are his "actual summary" Gross Annual rent is $35,820.Other Income $600Vac Loss $1,791.Effective Gross Income $34,629Property Taxes $2,245Operating Expenses $6,528.00Total Expenses $8,773Net operating Income $25,856My thoughts were to do seller financing for 12 months to 18 months, then purchase the property through a conventional loan.

Once they move out and rent both units they will typically see about $600 in gross cash flow, maybe a little more.

UNDERWRITING AND PROJECTIONSAre the forecasted returns gross or net?

California charges a minimum tax of $800 a year per LLC, and more if you have gross receipts in excess of $250k.

You might get $200 a day but they are grossing $1000 plus a day. 

Carpet is kind of gross when you think about it. 

Gross rent/1%. $1500/.01= $150000 max purchase price.