Rent Collection & Delinquency: Late or missed rent payments strain cash flow and require constant follow-up. 4.

If both types of income are mixed in a single entity, the IRS may classify all the income as active, potentially subjecting your rental income to self-employment tax as well.To minimize self-employment taxes, it is important to keep active (flipping) and passive (rental) income streams in separate entities.

Here’s why:* You get multiple income streams from a single property.* Your tenants help pay down your mortgage, allowing you to scale faster.* FHA loans or conventional loans can help you finance up to a 4-unit property with low down payments (as low as 3.5% for FHA).Look at 2-4 unit properties in areas with strong rental demand.

Yes, having multiple streams of income and high income businesses helps for emergency debt service, which is very rare for the kinds of properties I buy but my income streams and businesses can very comfortably afford $1,800-$2K/month.

Others who are constantly late end up being given notice and leaving (I'm 2 for 2 on that). 

The issue that I see for STR is the constant upkeep and maintenance as you have a lot of different folks transiting through your property - that's a headache I don't need. 

For me, I run my own experiments and constantly try to get better/improve operations.

Because we all know what the struggles of being a business owner are—dealing with constant rejection, adjusting to new difficult circumstances, or making a new plan overnight. 9-5 salary workers just don't understand!

A lot of those deals look amazing on paper, but they can turn into a full-time job with tenant issues, break-ins, or just constant stress.

It constantly saves changes so I'm not worried about errors like you mentioned.