However, Even though the property is in service in 2025, you could still do a cost segregation study in 2026 and make a Section 481(a) adjustment to catch up missed depreciation......Anthony,as a tax professional, I'm confirming what Brian said.You will need to use the procedure he mentioned which involves completing Form 3115, as opposed to filing an amended return for 2025.

Reasonable estimates are a real sore spot for all involved.

The house I own alone is what I plan to use for financing as I would not need my uncle involved in the transaction.

Plan for 15 to 25 percent of the electrical budget to be discovered work.Biggest early mistake I made was not getting a structural engineer involved before closing.

Great topic — ground-up projects can produce strong margins, but execution risk is where many investors get caught off guard.From the builder/developer side, the biggest challenges we consistently see are:1️⃣ Site Work UnknownsFill, compaction, drainage, and soil conditions can shift budgets quickly — especially in markets where lot conditions vary significantly.2️⃣ Utilities & Impact FeesWater/sewer access, well/septic requirements, and local impact fees are often underestimated during underwriting.3️⃣ Environmental FactorsProtected species, wetlands, and flood elevation requirements can affect both timelines and build costs.4️⃣ Permit TimelinesApproval periods — particularly when civil or environmental reviews are involved — can extend holding costs beyond initial projections.5️⃣ Builder Execution CapacityProject success often comes down to the operator’s systems, trade relationships, and cycle times — not just the numbers on paper.Because of these hurdles, we’re seeing more investors lean toward ready-to-build projects — where feasibility, plans, and permitting are already in progress or completed — as a way to reduce entitlement risk and shorten timelines.Ground-up can be extremely rewarding, but the upfront diligence and execution planning are what ultimately determine outcomes.Always happy to compare notes with other investors and builders working through similar projects.

Also great to see your daughter getting involved at 17!

When investing in high cash-flow markets, I always recommend working with an investor friendly agent so you're able to gain the right insight into the different areas and the risks involved.

Oh yeah, we like to gloss over the negative, but I deal in the real world.I think most lending of this sort is in the 2nd position (very risky), if involved in purchases, or is to an overly optimistic "investor" buying a property at full price using a creative finance technique or doesn't anticipate market conditions shifting or . . . on and on.

Could you outline some of the key steps involved, such as conducting a home inspection on the rental property or personally viewing the unit, even if it is currently occupied by a tenant?

Foreclosures are rising in many markets and I suspect a portion of those may involve subject-to deals.