Most vacancy issues in stabilized multifamily is due to a stubborn owner holding out at too high of price.Vacancy is much more of a factor in retail and office where tenants aren't so easily or quickly replaceable.

.- Use cost segregation studies to expedite depreciation of your properties to offset large income gains.Entity Structure- Choose appropriate legal structure (LLC, partnership, or S corporation) with consideration for different tax implications.Tax Credits- Explore available credits, like energy-efficient or historic rehabilitation credits.Qualified Business Income (QBI) Deduction- Check eligibility for QBI deduction, providing up to a 20% deduction on qualified business income.Record Keeping- Keep accurate and organized records for tax compliance and audits.State and Local Taxes- Consider varying state and local tax implications, including property and income tax rates.Tax Planning- Engage in proactive tax planning, consulting with professionals for a comprehensive strategy.Tax Changes- Stay informed about changes in federal, state, and local tax laws affecting real estate investments.Remember to consult a real estate tax professional for personalized advice based on your specific situation.

I also saw another post from a few years back regarding this same issue so it seems it still needs to be fixed.

I've looked a few places and people have commented that this isn't an issue.

This seems the simplest, but will it cause issues down the road when I goto cash out refinance on the same property once casita is built with heloc money? 

Quick rundown of the numbers:Purchase: $130,000  Mortgage and escrow: $1045 Total Expenses: $1195Rent: $1500Total cashflow: $305Primary issue right now is a 2 year buy back term for a DSCR loan that does have a large penalty for that first 2 years. 

I suppose legally you could, if you fully disclosed the non arms length nature but, no lender in business, or wanting to stay in business would do it.At the end of the day, what you want, while it may make sense to you and your parents, just isn't a scenario that happens.  

Went under contract once but inspection came back with all sorts of issues.

@Jess AzongSo, if Title is held by the LLC and the loan is being issue to the LLC (good job in keeping it clean), the refi should issue the cash to the LLC. 

In Columbus, we take all of these issues you just mentioned and build a stacked triplex that has high density (42 dwelling units an acre), public utilities, higher rents per square foot, cost per unit under $115k basis for the investor (not $300k for a single family) and that is attached here.