It’s a bit of a process with several steps, but it's totally doable and well worth it for the added income!

I understand for tax purposes that I can only take two-thirds of the expenses related to the house to offset the rental income.

It's 20% down but it doesn't go off DTI but income of the property (yes, even SFH for STR).

Management company fee is 8% of gross collected rents = $80 per monthas a buyer of a property management company you would pay 1-1.25 for that income stream... which is an annualized number. $80 * 12= $960 *1 =  $960   or  80 * 12 = $960 *1.25 =$1200    that would be the "value" of that one account.    

Given that you have no income, and it's likely you may not meet the material participation threshold for 2023, the loss would then be kept on form 8582 to be used to offset future years of income from the property in the form of a "carryover loss"

That plus your debt-to-income ratio is really going to be the determining factors on your budget for your house shopping.

Consulting a lawyer and accountant when tax season slows down but has anyone done this? 

Stuff like that will bug you, but I keep telling myself, it's passive income, you wanted to be hands-off...:)  Hopefully it's rented out fully soon or we'll be looking to do a SFH with another management company most likely.

Hi Josh, Additionally, consider building conservative assumptions into your financial projections to account for potential market fluctuations, economic uncertainties, and unforeseen challenges.

I just sold a duplex for $520,000 in four days, even though the current income is $1800/month and the market rate is only $3,000/month.