Many people do this or a 1031 to avoid a huge tax bill.

If your main goal is to sell soon and maximize resale value, it’s usually better to avoid construction while guests are staying there.

At least you’re in Texas to avoid the state income tax kicker.  

(Credit requirements, equity needed, timing considerations, etc.)- ⁠Any pitfalls with transferring VA-financed properties into an LLC?

What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.?

If the lots are pretty infill and standard, then hopefully not an issue, but if they are on any windy hillside streets, or if it's a flag-shaped lot tucked in among other parcels, sometimes it's good to make sure that the fire department wouldn't require anything special. 

You may want to hire a PMC to run it as you learn more - to avoid catastrophic mistakes!

For example, in September of 2023 New York mandated that all short term rental hosts must reside at the property.To avoid regulation change issues, it is key to make sure you are buying in established Vacation markets and that your communicating with the City or County in which the property is located to understand what the current sentiment of the people and stance of the city is on coming Airbnb regulations, and avoiding properties located within HOAs / Condo Associations / Co-Ops.

I also find that it's easier to place quality tenants when they're dealing with you and not a property management company - a lot of tenants have had bad property management experiences and avoid listings when they see a company with a bad reputation.

Who’s had success with wraparound mortgages, and what pitfalls should others avoid?