It's not profit until you access it in some form of cash.I've seen investors loss properties with equity (a few with a lot of equity) because they can't sell at a price high enough to gain that equity, or because they can't refinance it due to the negative CF,...which would increase with a new mortgage.

Because I benefit from more business oriented books I also like Who Not How and Gap and the Gain by Dan Sullivan and Ben Hardy.

Looking for ways to create more passive income for myself.I guess an additional question is how profitable should I expect a short term rental to be in that area? 

@Rachel Seymour-NewtonIf the smaller property is a strong deal with solid cash flow and tenant demand, it could make sense to buy now and start gaining experience.

Lowering it by $100 could gain more interest & lease it out sooner.

The $450K will be returned to me as payback of my loan to the intermediary, without trigger any capital gain taxes, right?

When I build the passive income I want, I will seek opportunities to present to groups on topics which are dear to me ... credit literacy, financial literacy, etc.

Talk to your tax advisor about how to release your passive activity losses based on your situation.This post does not create a CPA-Client relationship.

Realistic because I see people do this all the time, but hard because the amount of deals and capital it takes to get to 10 K passive per month is no joke.

He didn't have much downside in terms of potential losses, and I could be somewhat passive and protected legally (he owned the building site etc. and took care of liability).