As somebody who self-manages my properties, I put a lot more weight on the location and type of renters I can attract than on maxing out my returns because the returns don't factor in the additional work that is required on the higher return properties.

Ideally, I would invest here in the Bay Area where I live in order to take advantage of a low downpayment (forgot to mention, I've been looking mainly at Homepath properties) and also to be able to self-manage.

I have a full time job and self manage about 15 units as well as extensive rehabs all at the same time, and it can get very challenging at times.

I'm good with the operating agreement stuff and risk assessment stuff.

How did you get comfortable that this is a passive investment (ie. triggering capital gains) vs business income (ie. ordinary income and self employment tax), given the profit participation.

The son is moving to a new city and my tenant simply asked if she could keep the son's dog for a few months while son was getting settled.If it were a small dog, we were inclined to accommodate her because she is a good tenant and will likely buy the house at some point - she has great credit and just needs to show enough self-employment income this year to qualify (IOW, take fewer business expenses and legal deductions).The picture is from the application.

Now that you've mentioned it, I'll be sure to keep an eye out to see if my initial assessment was off the mark.I haven't listened to the latest podcast yet, but I'll be sure to give it a listen over the weekend.

My business is an LLC and I have been planning to rent my basement to the business LLC already - and I have spoken, at least preliminary, to my accountant about this with no obvious objection.

My main objective is to acquire at least 2 properties this year, more would be awesome.

If you self manage during year 1, you'll only be out about $760/month personally.