New STR owner
Member since 2026 · 11 posts · 3 votes
New STR owner
Most Popular Reply
Ashish AcharyaBusiness Member
CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votesHey Maxie, that's awesome that the cost seg wiped out your 2025 tax bill, that's exactly how it's supposed to work and it sounds like you executed it really well for your first year and I will just tag along to what the others above have said.
The growth phase question is a great one. The honest answer is that the big first-year depreciation benefit from bonus depreciation is a one time thing unless there are any remaining improvements or additions to the current property that happened after the original cost seg was done.
So to keep that tax efficiency going in 2026 and beyond, the main lever most investors pull is acquiring another property and running the same playbook again; buy, put on Airbnb, cost seg, capture the accelerated depreciation in year one.
The bigger picture question as you scale is making sure your material participation is documented properly each year so the STR losses continue to offset your other income the way they did in 2025. That's not something you want to assume is automatic, it needs to be tracked and supported. Definitely worth sitting down with your CPA before the end of 2026 to map out the growth plan and make sure the tax strategy keeps working as you add properties. Happy to connect!
INVESTOR FRIENDLY CPA®5241 Reviews
21 Replies
- 3moJake YuskaitisBusiness MemberLender · New Jersey, USA · Member since 2022 · 254 posts · 67 votes
what do you mean? you want to do another cost seg? cost seg is typically only done once per property unless a lot of rehab has been put into it that calls for a new schedule.
Frontier Funding LLC533 Reviews - Member since 2026 · 11 posts · 3 votes3mo
No. I dont need to. Im talking about growth phase. Buying another property and doing the same thing so I can reduce my tax burden for 2026.
- 3moAmit PatelBusiness MemberProperty Manager · Bartlett, IL · Member since 2025 · 148 posts · 59 votes
Hello! First off, congrats on the strong start!
To move into the growth phase in 2026, focus on making your current property as profitable and stable as possible first. Maximize occupancy and average daily rate with good pricing tools, strong photos, and reviews. Track every expense so you know your true cash flow after the tax savings. That cash flow plus the tax refund you received becomes your down payment engine for the next property.
When you are ready to buy again, look for another property that qualifies for cost segregation (ideally something with a decent amount of personal property or improvements you can accelerate). Many people repeat the same move: buy, cost seg, harvest the tax savings, and use it toward the next down payment while the first property keeps throwing off income.
The biggest trap I see with new STR owners wanting to grow fast is buying the second property before the first one is truly dialed in. Get systems in place now (cleaning, maintenance, guest communication) so the business can run without you being hands-on 24/7. Once that is solid, scaling becomes much easier and less stressful. Hope this helps
Casanomy Property Management563 Reviews- Virtual Assistant · Abuja, Nigeria | Remote · Member since 2026 · 75 posts · 28 votes3moYou are absolutely right 👌
Quote from @Amit Patel:
Hello! First off, congrats on the strong start!
To move into the growth phase in 2026, focus on making your current property as profitable and stable as possible first. Maximize occupancy and average daily rate with good pricing tools, strong photos, and reviews. Track every expense so you know your true cash flow after the tax savings. That cash flow plus the tax refund you received becomes your down payment engine for the next property.
When you are ready to buy again, look for another property that qualifies for cost segregation (ideally something with a decent amount of personal property or improvements you can accelerate). Many people repeat the same move: buy, cost seg, harvest the tax savings, and use it toward the next down payment while the first property keeps throwing off income.
The biggest trap I see with new STR owners wanting to grow fast is buying the second property before the first one is truly dialed in. Get systems in place now (cleaning, maintenance, guest communication) so the business can run without you being hands-on 24/7. Once that is solid, scaling becomes much easier and less stressful. Hope this helps
- Member since 2026 · 11 posts · 3 votes3mo
Quote from @Amit Patel:
Hello! First off, congrats on the strong start!
To move into the growth phase in 2026, focus on making your current property as profitable and stable as possible first. Maximize occupancy and average daily rate with good pricing tools, strong photos, and reviews. Track every expense so you know your true cash flow after the tax savings. That cash flow plus the tax refund you received becomes your down payment engine for the next property.
When you are ready to buy again, look for another property that qualifies for cost segregation (ideally something with a decent amount of personal property or improvements you can accelerate). Many people repeat the same move: buy, cost seg, harvest the tax savings, and use it toward the next down payment while the first property keeps throwing off income.
The biggest trap I see with new STR owners wanting to grow fast is buying the second property before the first one is truly dialed in. Get systems in place now (cleaning, maintenance, guest communication) so the business can run without you being hands-on 24/7. Once that is solid, scaling becomes much easier and less stressful. Hope this helps
I have it on Airbnb and booking.com. we are using hospitable and price labs. We are about 72% occupancy which is 42% higher than similar listings. We have cleaning automated, messaging through hospitable with automated and some manual messages. A little more than I would like. We have a property manager charging us only 10% in case we need someone physically to be there. We have been in Mexico for 8 weeks and its been going fine. We are going to be here 3 more weeks and then 8 weeks in the Phillipines. I feel there are still things that come up but it is not taking very much time from our missionary work We are doing. So if that sounds like we should be looking to grow, I would like to know how that works.
- Member since 2026 · 11 posts · 3 votes3mo
This is my property
https://www.airbnb.com/rooms/1576318453479734066?unique_share_id=456149f0-1487-4214-8c12-b8e95154a5d4&viralityEntryPoint=1&s=76
- 3moAmit PatelBusiness MemberProperty Manager · Bartlett, IL · Member since 2025 · 148 posts · 59 votes
Quote from @Maxie Massengale:
This is my property
https://www.airbnb.com/rooms/1576318453479734066?unique_share_id=456149f0-1487-4214-8c12-b8e95154a5d4&viralityEntryPoint=1&s=76
Your current setup already looks strong with seventy two percent occupancy beating the market, good automation through Hospitable and Price Labs, and only needing a ten percent property manager while you travel for months. Since it is running well with very little of your time, you are in a good position to start thinking about adding a second property without overextending yourself.
The cleanest way to grow is to take the tax savings from the cost segregation on this one plus the actual cash flow it is generating and use that toward the down payment on the next property. Look for another single family or small multi unit that still has solid short term rental demand in its area and qualifies for cost segregation again so you can repeat the tax benefit.
Before buying, run the full numbers carefully on any new deal, including realistic occupancy, vacancy, all expenses, repairs, and the management fee, to double check it actually cash flows after everything. It is easy to get excited about a lower purchase price, but the real test is whether the property supports itself once it is up and running.
Keep a close eye on the first property while you add the second so it stays performing well. Once both are stable, you can look at scaling further with the same model. Hope this helps
Casanomy Property Management563 Reviews - Member since 2026 · 11 posts · 3 votes3mo
Quote from @Amit Patel:
Quote from @Maxie Massengale:
This is my property
https://www.airbnb.com/rooms/1576318453479734066?unique_share_id=456149f0-1487-4214-8c12-b8e95154a5d4&viralityEntryPoint=1&s=76
Your current setup already looks strong with seventy two percent occupancy beating the market, good automation through Hospitable and Price Labs, and only needing a ten percent property manager while you travel for months. Since it is running well with very little of your time, you are in a good position to start thinking about adding a second property without overextending yourself.
The cleanest way to grow is to take the tax savings from the cost segregation on this one plus the actual cash flow it is generating and use that toward the down payment on the next property. Look for another single family or small multi unit that still has solid short term rental demand in its area and qualifies for cost segregation again so you can repeat the tax benefit.
Before buying, run the full numbers carefully on any new deal, including realistic occupancy, vacancy, all expenses, repairs, and the management fee, to double check it actually cash flows after everything. It is easy to get excited about a lower purchase price, but the real test is whether the property supports itself once it is up and running.
Keep a close eye on the first property while you add the second so it stays performing well. Once both are stable, you can look at scaling further with the same model. Hope this helps
So the tax refund is going towards debt incurred getting the place stable on Airbnb. Except for 6k. The one thing I'm not good at is getting an accurate depiction on whether a property will do well in Airbnb. An tips on that would be helpful.
- 3moArman AhmedPro MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 917 votes
Quote from @Maxie Massengale:
My wife and I bought our first small single family dwelling Dec 22 2025. We put it on AIRBNB and did a cost seg. The depreciation taken returned all the taxes we paid in 2025. We want to do it again in 2026 but don't know how to be in the growth phase.
Nice first move getting the STR + cost seg working for you that quickly. The next growth step usually comes down to systemizing what already worked, tightening operations, tracking what actually drives occupancy and pricing, and then scaling only in markets where the numbers stay consistent year-round. A lot of STR investors hit a ceiling when they expand too fast in one seasonal market, so some end up diversifying into more stable Midwest areas where mid-term or hybrid STR models can smooth out income between seasons. If you can replicate your first setup with better data and stronger demand stability, scaling becomes a lot less guesswork.- Member since 2026 · 11 posts · 3 votes3mo
Quote from @Arman Ahmed:
Quote from @Maxie Massengale:
My wife and I bought our first small single family dwelling Dec 22 2025. We put it on AIRBNB and did a cost seg. The depreciation taken returned all the taxes we paid in 2025. We want to do it again in 2026 but don't know how to be in the growth phase.
Nice first move getting the STR + cost seg working for you that quickly. The next growth step usually comes down to systemizing what already worked, tightening operations, tracking what actually drives occupancy and pricing, and then scaling only in markets where the numbers stay consistent year-round. A lot of STR investors hit a ceiling when they expand too fast in one seasonal market, so some end up diversifying into more stable Midwest areas where mid-term or hybrid STR models can smooth out income between seasons. If you can replicate your first setup with better data and stronger demand stability, scaling becomes a lot less guesswork.This property works well primarily because it was doing well on Airbnb by the previous owner before we purchased it. We just made some improvements and increased occupancy and automation. We need help determining how to look at a new property for is str value.
- 3moJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votesHi Maxie, first off, congrats on getting your first property up and running and seeing the benefits of a cost segregation study. The growth phase is usually about taking the systems and lessons from property number one and figuring out how to acquire property number two without stretching yourself too thin. A lot of investors focus on improving the performance of the first property, building reserves, and creating a clear acquisition plan before scaling. You may want to look at how much equity you're building, your cash flow, and whether you can qualify for additional financing while maintaining healthy reserves. I'd also spend time tracking the actual performance of the Airbnb over a full year so you have solid data for future purchases. The biggest mistake I see newer investors make is growing too quickly without enough cash reserves or operational systems in place. If your first deal is performing well and your numbers support it, adding another property in 2026 can be a great way to continue building momentum while keeping your risk manageable.
Quote from @Maxie Massengale:
My wife and I bought our first small single family dwelling Dec 22 2025. We put it on AIRBNB and did a cost seg. The depreciation taken returned all the taxes we paid in 2025. We want to do it again in 2026 but don't know how to be in the growth phase.
Jimmy Lieu, Red 1 Realty4.9120 Reviews- Member since 2026 · 11 posts · 3 votes3mo
Quote from @Jimmy Lieu:
Hi Maxie, first off, congrats on getting your first property up and running and seeing the benefits of a cost segregation study. The growth phase is usually about taking the systems and lessons from property number one and figuring out how to acquire property number two without stretching yourself too thin. A lot of investors focus on improving the performance of the first property, building reserves, and creating a clear acquisition plan before scaling. You may want to look at how much equity you're building, your cash flow, and whether you can qualify for additional financing while maintaining healthy reserves. I'd also spend time tracking the actual performance of the Airbnb over a full year so you have solid data for future purchases. The biggest mistake I see newer investors make is growing too quickly without enough cash reserves or operational systems in place. If your first deal is performing well and your numbers support it, adding another property in 2026 can be a great way to continue building momentum while keeping your risk manageable.Quote from @Maxie Massengale:
My wife and I bought our first small single family dwelling Dec 22 2025. We put it on AIRBNB and did a cost seg. The depreciation taken returned all the taxes we paid in 2025. We want to do it again in 2026 but don't know how to be in the growth phase.
Thank you, we are cautious about a new property because we want to have a emergency fund for the property in case something happens. We will look at reserves once all debt is paid off.
- Member since 2026 · 11 posts · 3 votes3mo
I think the main focus would be how to analyze a good deal if one shows itself.
- 3moAshish AcharyaBusiness MemberCPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
Hey Maxie, that's awesome that the cost seg wiped out your 2025 tax bill, that's exactly how it's supposed to work and it sounds like you executed it really well for your first year and I will just tag along to what the others above have said.
The growth phase question is a great one. The honest answer is that the big first-year depreciation benefit from bonus depreciation is a one time thing unless there are any remaining improvements or additions to the current property that happened after the original cost seg was done.
So to keep that tax efficiency going in 2026 and beyond, the main lever most investors pull is acquiring another property and running the same playbook again; buy, put on Airbnb, cost seg, capture the accelerated depreciation in year one.The bigger picture question as you scale is making sure your material participation is documented properly each year so the STR losses continue to offset your other income the way they did in 2025. That's not something you want to assume is automatic, it needs to be tracked and supported. Definitely worth sitting down with your CPA before the end of 2026 to map out the growth plan and make sure the tax strategy keeps working as you add properties. Happy to connect!
INVESTOR FRIENDLY CPA®5241 Reviews - Accountant · CO · Member since 2026 · 11 posts · 9 votes3mo
The part I’d be careful with is thinking of the tax result as the strategy itself. A cost seg/bonus depreciation result can be very helpful, but it’s mostly an acceleration of deductions, not free money.
For 2026, the “growth phase” probably starts with a few questions:
- Are you trying to buy another STR?
- Will you materially participate again?
- Will the average guest stay still qualify for STR treatment?
- Do you have enough income/basis/at-risk amount to actually use the losses?
- Does the deal work even before the tax benefit?
The tax side can be powerful, especially with STRs, but I wouldn’t buy the next property just to recreate the refund. I’d start with the investment fundamentals first, then layer the tax planning on top.
There are a lot of good real estate-focused CPAs on BiggerPockets who can help model this out before you buy the next one.
- Member since 2026 · 11 posts · 3 votes3mo
Quote from @Johnny Lujan:
The part I’d be careful with is thinking of the tax result as the strategy itself. A cost seg/bonus depreciation result can be very helpful, but it’s mostly an acceleration of deductions, not free money.
For 2026, the “growth phase” probably starts with a few questions:
- Are you trying to buy another STR?
- Will you materially participate again?
- Will the average guest stay still qualify for STR treatment?
- Do you have enough income/basis/at-risk amount to actually use the losses?
- Does the deal work even before the tax benefit?
The tax side can be powerful, especially with STRs, but I wouldn’t buy the next property just to recreate the refund. I’d start with the investment fundamentals first, then layer the tax planning on top.
There are a lot of good real estate-focused CPAs on BiggerPockets who can help model this out before you buy the next one.
Are you trying to buy another STR?
yes, for both the increased profitability.
Will you materially participate again?
yes, we would. Just need to make sure/strategies with CPA on documenting it.
Will the average guest stay still qualify for STR treatment?
yes, using same airbnb, booking.com. maybe expand to vrbo and more direct bookings.
Do you have enough income/basis/at-risk amount to actually use the losses?
We are missionaries and receive funds for that, where taxes need to be paid for.
Does the deal work even before the tax benefit?
I still dont know how to properly analyze a deal. This first one was God's blessing that fell out of the sky basically.
- 3moBasit SiddiqiBusiness MemberAccountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
wouldn't the refund that you received be a good chunk to use towards the next purchase?
Basit Siddiqi CPA4.979 Reviews- Member since 2026 · 11 posts · 3 votes3moSo the tax refund is going towards debt incurred getting the place stable on Airbnb. Except for 6k.
Quote from @Basit Siddiqi:
wouldn't the refund that you received be a good chunk to use towards the next purchase?
- Accountant · Long Island, NY · Member since 2021 · 184 posts · 148 votes3mo
Quote from @Maxie Massengale:
So the tax refund is going towards debt incurred getting the place stable on Airbnb. Except for 6k.Quote from @Basit Siddiqi:
wouldn't the refund that you received be a good chunk to use towards the next purchase?
Hi @Maxie Massengale - as long as the current property is stabilized, and you enjoy managing STRs, then my recommendation would be to buy another and do the same thing!
Keep the velocity of money going and look to acquire another property. If you buy in a similar area, you can actually group your hours between each property for material participation!
Ex. 5 hours spent on existing airbnb + 100 hours spent on new airbnb = 105 hours. As long as you spent more time than anyone else, you have passed the material participation requirement! The IRS will view both rentals as one economic activity if you group them together. As @Ashish Acharya stated, you want to make sure that not only your CPA is aware of this, but they actually make the grouping election on your tax return.
- Member since 2026 · 11 posts · 3 votes3moThat is excellent! I didn't know that. What is the grouping rules? City, county, state, country?
Quote from @Christopher Tile:
Quote from @Maxie Massengale:
So the tax refund is going towards debt incurred getting the place stable on Airbnb. Except for 6k.Quote from @Basit Siddiqi:
wouldn't the refund that you received be a good chunk to use towards the next purchase?
Hi @Maxie Massengale - as long as the current property is stabilized, and you enjoy managing STRs, then my recommendation would be to buy another and do the same thing!
Keep the velocity of money going and look to acquire another property. If you buy in a similar area, you can actually group your hours between them.
Ex. 5 hours spent on existing airbnb + 100 hours spent on new airbnb = 105 hours. As long as you spent more time than anyone else, you have passed the material participation requirement! The IRS will view both rentals as one economic activity if you group them together. As @Ashish Acharya stated, you want to make sure that not only your CPA is aware of this, but they actually make the grouping election on your tax return.
- Accountant · Long Island, NY · Member since 2021 · 184 posts · 148 votes3mo
Quote from @Maxie Massengale:
That is excellent! I didn't know that. What is the grouping rules? City, county, state, country?Quote from @Christopher Tile:
Quote from @Maxie Massengale:
So the tax refund is going towards debt incurred getting the place stable on Airbnb. Except for 6k.Quote from @Basit Siddiqi:
wouldn't the refund that you received be a good chunk to use towards the next purchase?
Hi @Maxie Massengale - as long as the current property is stabilized, and you enjoy managing STRs, then my recommendation would be to buy another and do the same thing!
Keep the velocity of money going and look to acquire another property. If you buy in a similar area, you can actually group your hours between them.
Ex. 5 hours spent on existing airbnb + 100 hours spent on new airbnb = 105 hours. As long as you spent more time than anyone else, you have passed the material participation requirement! The IRS will view both rentals as one economic activity if you group them together. As @Ashish Acharya stated, you want to make sure that not only your CPA is aware of this, but they actually make the grouping election on your tax return.
@Maxie Massengale Generally you want it to make sense. If you have one STR in California, and one in New York, it might not pass the reasonableness test from a grouping standpoint. But, if the rentals are a short drive between each other, we would want to group the activities together (it's reasonable to say these can be considered one economic activity)
Some CPAs are more aggressive than others when it comes to this, so I'd advise speaking to your CPA about it
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