We are looking towards STRs in order to lower our W-2 taxable income via cost seg and bonus depreciation.I believe my line of work qualifies me as a REP, but what I am not clear on is whether I would still need to meet the 'material participation' requirements in our rental business in order for our losses to be non-passive.

All of this equates to lower returns with turnover costs, being the primary one.  

Seems like it's in a lower end area so if it is filled you will have tenant issues and turnover cost.

@Vincent WeselakIt’s a good idea to get an estimate for your insurance costs upfront since this can vary based on the property type and location, and it’s a key factor in evaluating your cash flow. 

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

I would connect with other investors and go to a few free/low-cost meetups to start and learn from them the strategy and how they learned to do what they did.

For your first BRRRR, plan for extra in your rehab budget—unexpected costs happen.

@Tiffani HollisFor a long-term rental, I’d avoid used dishwashers entirely—repair costs and reliability issues often outweigh the savings.

What is the cost of the service?

While the right program can provide a strong ROI, it’s crucial to evaluate whether the cost fits within your budget and aligns with your current investment goals.2.