I’m fully prepared that there may be unforeseen costs, but I can’t even estimate properly for your standard cosmetic rehab… have you walked through the property?

That way you are training him to go through the proper channels.  

If you purchase a newer property that has been recently and properly renovated, you may consider using a lower percentage.The biggest impact on your cash flow will come from the property’s location.

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.7.

While you shouldn’t categorize all tenants and it’s the landlords responsibility to properly screen, the tenants who reside in better situated housing and pay higher rents are more financially responsible meaning lower rate of rent loss and will generally take better care of the property which combined will result in less time allocated towards management functions if self-performed or more favorable management fee structures if 3rd party management companies are utilized (which ties back to #1, as well).

Pro: In a conventional banking system, you have to trust people to handle your money properly along the way.

Connect with local investors and experts for a house-hacking strategy and ensure proper permits for rental properties.Good luck!

It's a flexible approach, suitable for both single-family homes and multi-unit properties, and can be tailored to fit your lifestyle and financial goals.It's important to research local housing laws and market conditions to ensure a successful house hacking venture.

Thanks James for the proper terminology.