While it's great to own property in San Diego, I may just have to cut my losses and look elsewhere.

Catastrophic losses are covered under my insurance.

We do not currently qualify for Real Estate professional status at this time, but my understanding is that STR losses are considered non-passive losses.

We absorbed the loss.

If you experienced appreciation while it was your primary residence, be sure to consider the loss of the section 121 gain exclusion on the sale of a primary residence...250k/500k gains excluded from tax for single/married on the sale of a primary residence...goes away if you hold as a rental longer than three years.

I also mean to say the low returns you would get here are not worthwhile considering the temporary depreciation losses a CA investor would see in the event of economic correction.

I fully believe in my personal opinion that 50% or better of out of state investors who buy 40k and under all in urban core assets will take a substantial loss not to mention never make any cash flow ...

You can take the loss, chalk it up to a learning event, and do better next time.

Never refer to the other one in either contract.If you include rent credits, you are opening yourself up to a date in court...and a loss in court. 

I have only owned rentals for about 6 years, so curious for those of you that owned rentals the last time we had a real uptick in job losses (2008-2010), how did your portfolio hold up on lost rent due to nonpayment, higher vacancy rates, etc?