First Investment Advice – STR vs LTR

[Paul Wolfson]

I have $100k to invest and live in California. I'm planning to buy my first out-of-state rental and would appreciate some advice.

I'm deciding between:

• * A long-term rental (LTR) in a growing market (population growth, good school district, low crime, median home prices under $500k)
• * A short-term rental (STR) in a vacation market (e.g., Gatlinburg, Broken Bow, Myrtle Beach, Bronson, under $500k)

My goal is to scale and buy another property (STR or LTR) within 2 years.

Here are the main factors I'm weighing:

• STR pros: Potential for higher cash flow, can offset W2 income with bonus depreciation, write off all expenses against W2. STR Loophole allows me to achieve my goal faster.
• LTR pros: More passive, long-term stability.

For a first-time investor, which path would you take and why? Any markets you'd recommend?

Appreciate any insights!