We found a few things that were major violations, brought this up to the seller & came to a solution that everyone was happy with, a little price reduction & a little credit after closing.  

Of course every situation is different and maybe if I had held the first property longer, or if the first property's land were worth more, or if I were in a different tax bracket, etc etc, the analysis might yield a different result.But if my calculations are correct, then I am not suffering from a (significant) reduction in depreciation, and I would much rather deploy the deferred capital gains in my next property than pay them at this time.  

These houses are still settling and the engineered works better.LVT for the basement areas due to the moisture issues that can occur.Carpeting the steps from first floor to second does help with noise reduction.

Then the question really becomes, how much do I want to get hit in taxes and if it's resirable for the reduction that will occur because of the taxes.

While I would think active investing (you know, wholesaling, flipping, being a landlord) as well as value adding to the property, would deliver a fat check, I would think passive investing would be equally as beneficial, especially for beginners, as well as more opportunity to invest in other markets than the one you reside in.

I'm leaning towards the "reduction in income" selection as it's true and it doesn't require hardship documentation....Is there high risk that this won't be approved for a short sale because of the condition of the house?

Hi @Nick Zocher,It's rare that anyone does this, but in theory you can...1) Buy using a normal mortgage, typically a 30 year fixed with a jacked up rate and fat lender credit.2) Not wait six months.3) Do your improvements to make ARV the current actual value.4) Cash out refinance with hard money or a friend or whatever.

Adding capital appreciation of 3%, Joe and Mike would make 7%, 11%, or 17% of their 10,000 while Bob would make the same plus principal reduction on the mortgage while getting his 20,000 down payment out for use in the next venture.

She'll haul anything and everything I need for my rehabs, plus she rides like a big fat Camry--comfy.I do not trade in my vehicles every couple of years.  

By doing (and documenting) extensive renovations on the front end to the properties, it raises the initial price, but we are seeing a drastic reduction in deferred maintenance and holding costs.Lastly, this particular property is being purchased by an investor for $47 per square foot after all costs which is an extremely good deal.