AdvantagesSince we are dealing directly with no real estate agent involved, we will save 5-6% on the deal which we will split 50-50.This one is a small advantage, but still mentioning it here.

BRRR works and is really profitable, but if you want to ask about specific deals than you're going to find some that use this method poorly.

@Hiro Kitagawa, qualified improvement property has become a bit more interesting than your CPA made it out to be.Now, there is in fact a category for owners of non-residential real property called qualified improvement property (QIP) that as of 1/1/18 replaced the old qualified improvement property (yes, same), qualified leasehold improvement, qualified retail improvement, and qualified restaurant property classification rules, as well as includes some property that would not have fallen into those buckets previously.The committee reports indicated that QIP placed in service on or after 1/1/18 would be eligible for a 15-year depreciable life as well as bonus depreciation rather than the standard 39-year, non-bonus eligible method applied to non-residential real property.However, the law was not drafted correctly, i.e., there was a technical error, and the section of the tax code describing 15-year property (Section 168(e)(3)(E)) was in fact not amended to include qualified improvement property.So for now, strictly-speaking, in 2018, qualified improvement property is regular old 39-year property that is not eligible for bonus depreciation.We do expect that a technical correction to the law will be made, but for now the IRS has actually stated that it cannot guarantee that absent legislative correction it will accept the legislatively intended change in recovery period and bonus eligibility.Anyway, this is neither here nor there since you have stated you are a landlord of residential rental property rather than non-residential real estate.And this does not affect the application of 100% bonus depreciation to both qualifying new and used property place in service after 9/27/17 and before 1/1/23 that @Yonah Weiss pointed out.

Thanks @Steve Vaughan and @Wil Reichard,  So if I am not planning on doing the BRRRR method, because I don't want to deal with all the rehab that will be needed, how else would you go about it, given my situation?

@Upen Patel You made me curious when you say that a HML is a mortgage irrespective of whether it has been recorded are you saying in the sense that it’s a loan on a piece of property and therefore a mortgage or is there another method of legally recording a mortgage?

My full time job is as an officer in the Navy, but I am involved in quite a few side hustles.

You are never allowed to be involved in the management of the property.

I went down the wholesaling rabbit hole and decided I wasn't a fan, explored creative financing compared to my personal risk tolerance and logged it away for future potential use, found the BRRRR method and read just about everything posted about it.

Owning that property helped me better appreciate the advantages of real estate investment and made me want to learn more and get more deeply involved.

In most markets and neighborhoods you can establish a pattern but in markets like these it becomes completely subjective by using the extraction method.