Quote from @Dave Allen: Quote from @Zeke Liston: Quote from @Dave Allen: I'm in a bit of a situationMy wife and her parents are selling a duplex they own together.My wife is trusting me to re invest into cash positive investments.We could stand to take as much as a quarter million, and tax free since we lived in the property 2 of the last 5 years.What are some suggestions for markets that would provide cashflow?

suggest you find a different attorney firm to work with...they'll take a cut, but worth it.

Someone suggested mid-term rentals may yield better cash flow.

However, saying that there are many companies that do both that are amazing and don't do things like this, so I'm not suggesting that doing both is inherently negative. 

Would love to hear from anyone who have success stories and I am open to suggestions.

With enough knowledge you can make a educated decision on which approach you take.My experience:I personally don't sign up for any program who take you aside during events and try to sell packages that is just blatant sales strategy.Once you sign up there is every attempt to make you sign for their programs for bookkeeping, registered agent, LLC or corp setup fee which have ridiculous even with platinum membership.Basic standard structure they suggest to take advantage of multiple deductions can be easily achieved by proper education or work with a good firm like https://wcginc.com  who is local to you.A umbrella C-crop to manage all other LLC properties and take advantage of many tax deductions that are not available with a llc, its also used to take losses up to 100K as startup expenses and dissolve the entity after few years.Few LLC entities for investing in Real Estate, etc preferably in Wyoming or Nevada ( you can find many companies online who can do this for $150 compared to anderson $1500-$3000) , they will claim they have a secret Operating agreement which is bogus.They certainly try to take advantage of tax loopholes and claim to be smart people, my view they are just taking advantage of numbers as per their own statements.

You also want to see a reserve study and only invest in a property where the HOA is at least 30% funded, less than that is assessment territory. 

We value the opportunity to work with clients and partners in the real estate community.To address @David Ramirez' suggestion, if any title issues are found, the earnest money is fully refundable.

My only suggestion regarding Junior ADU's is to make sure you understand the law and what constitutes a "Junior" ADU.

A study recently completed showed that most squatters are attracted to two properties: vacant and those listed for rent stating 'for immediate occupancy' or vacant.