Self managed HOAs are usually undercapitalized so you want to take a thorough review of the condition of the community to make sure there isn’t deferred maintenance because you might get hit with a special assessment if the board isn’t setting aside cash for those capital improvements.At face value, taking into consideration my typical financial objectives, I wouldn’t do this deal unless it was a much lower price.

It looks like according to the county site (sbcounty.gov) they require all renter payment go to the active owner. 

I have been digesting all things Real Estate so right now I am working to lower my DTI while saving at least 6-7% for the Owner Occupant down payment (to include closing cost, etc.).

Purchase price: $140,000 Cash invested: $55,000 Sale price: $255,000 My business partner and I took on this Arlington property as a fix-and-hold investment.

The investor either gets a loan or buys the property in cash.

The reason is the rent-to-price ratio is good so you can cash flow, and most of the West side doesn’t have a Point of sale inspection which is really annoying.

There is almost no scenario where a condo would ever positive cash flow while servicing debt, and very little positive cash flow with no debt.If your budget only allows for a condo, find a better place to put your money to work.   

You are missing my point on taxes.Scenario 1:  Your partner buys the house at the same time you put your cash in.  

It's an amazing market to be in because you can still find the 1% rule and positive cash flow while getting amazing appreciation potential.

Mostly people with minimal RE experience are adding a single ADU and they often make that choice based on cash flow without taking into account the negative equity position.