Additionally, the replacement property must be real estate to qualify under IRS rules.

3️⃣ Local Regulations: Before you invest in a short-term rental, it's essential to understand the local rules and licensing requirements.

That's why I tell a lot of my clients that it's a perfect time to invest right now when you can still find the 1% rule and positive cash flow especially in properties here that are still 120-180k in purchase price.

@Mattin Hosh first, most cities in Metro Detroit have some type of rental property inspection every 2-3 years.It's not really a big deal 99% of the time - especially for owners who are NOT slumlords:)Also, a quick Google search will show that several states/cities are passing/considering similar legislation.One of the biggest mistakes we see newer investors making is NOT properly understanding Neighborhood/Property/Tenant Classes and naively assuming that any rental they buy will deliver Class A results.Read our copy & paste thoughts below and DM us if you'd like to dicuss more about the Detroit market:)-------------------------------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

@Paulette Midgette I haven't looked at that statute in a while but I would check to see if the Home Improvement Consumer Protection Act ("HICPA") applies to this situation.

Offer discounts for applying in a short time period or- offer a free application fee. 

If it is less than 30 days, the owner can kick someone out for failing to pay or obey the rules.

The facts are clear, RAD operated illegally in Philadelphia...didn't apply for permits and licenses then misrepresented values of their assets which I understand were relied upon for their share prices.

The interest tracing rules come into play for debt financed distributions.

@Polat Caglayan very ambiguosu question, but read the helpful info below to guide your next set of questions:)-------------------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?