.• Track hours if you or your spouse aim for Real Estate Professional Status (REPS) or use the STR loophole on future deals—depreciation losses can then offset W-2 or active income.Bottom line: keep the rentals in LLCs for liability protection, maintain them as pass-through for tax simplicity, and separate management income if needed for tax savings. 

Therefore unless there is an existing use permit that's been maintained through proper licensing you will be required to obtain a variance.

Professional inspection reports can prove that the building is well-maintained and structurally sound.Consider working with an independent agent or a broker who specializes in multi-family and historic properties.

A 16% cap rate sounds promising on paper, but the logistics matter a lot: staffing, guest intake, rent collection, compliance with local/state regulations, and community relations can all make or break the business.We’ve helped folks who purchase existing homes and those starting from scratch—developing systems for managing staff, automating collections, maintaining certification, and keeping occupancy high.

Because the Property Class dictates the Class of the tenant pool that the property will attract.The Tenant Class greatly impacts rental income stability and property maintenance/damage by tenants.Both Property Class and Tenant Class will affect what type of contractors, handymen and property management companies you should target and be willing to deal with a property.The Property Class will also impact the maintenance & renovations you do to,, “Maintain to the Neighborhood”.Why is that important?

Property Condition & Amenities: it’s important to, “Maintain to the Neighborhood.”Key metrics for each Property Class:Class A Properties:Tenant Pool: Majority of FICO scores 680+, no convictions/evictions in last 7 years.Tenant Default: 0-5% probability of eviction or early lease termination.Section 8: Class A rents are too high and won’t be approved.Vacancies: 5-10%, depending on market conditions.Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Class B Properties:Tenant Pool: Majority of FICO scores 620-680, some blemishes, no convictions/evictions in last 5 years.Tenant Default: 5-10% probability of eviction or early lease termination.Vacancies: 10-15%, depending on market conditions.Cashflow vs Appreciation: Typically, 1-3 years for positive cashflow, balanced amounts of relative rent & value appreciation.Section 8: Class B rents are usually too high for the Section 8 program.Class C Properties:Tenant Pool: Majority of FICO scores 560-620, many blemishes, but should have no convictions/evictions in last 3 years.

To take full advantage of the tax benefits, you’ll need to either actively participate in the rental activity or consider a Short-Term Rental (STR) strategy, which can potentially reclassify your income as non-passive if certain criteria are met.I also recommend maintaining detailed and accurate accounting records from the start — this includes tracking income, expenses, and any personal vs. rental use — as this will be essential for proper tax reporting and maximizing deductions.Let me know if you'd like help.

Hey BP Family,Long-time lurker, first-time problem poster.Would appreciate some seasoned perspective here.Property Context:SFR in San Jose (owned 5+ years)Tenants 26 months, never late on rent, maintain property wellHaven't raised rent since they moved in (below market now)Planning to hand to management company after they leaveWhat Actually Happened (Timeline):July 2023: One neighbor voicemail about music[14 MONTH GAP - nothing]Sept 2024: Different neighbor texts calling them "your migrant tenants"Jan 2025: New neighbor buys house behind property, immediately complains (he knew tenants were there when he bought)[8 MONTHS - completely quiet]Aug 21: Police show up at 8:49 AM, arrest someone, damage my fence[35 days pass]Sept 25: Attorney letter arrives (10-day deadline demanding resolution)Critical Details:The arrest was tenant's BROTHER (visitor on probation), not my tenantAttorney claims "ongoing nuisance" but there's been 8 months of silenceTenants tell me neighbors have been using racist language toward themAttorney letter mentions "vulgar language" and "threats" but no police reports or documentation of thisTenants are already actively house hunting (started before attorney letter)Attorney's Demands:Vague "resolve the matter" in 10 days (by Oct 5)Claims multiple neighbors but won't say whoCites the arrest prominently (but doesn't know it was a visitor)My Current Thinking:Get police report Monday (confirm visitor arrest)Work directly with tenants on move-out timelineMaybe help with moving costs if it speeds things upSend short response to attorney: "Matter being resolved, tenants relocating"Don't engage with neighbors at allSpecific Questions:Visitor arrest - I'm assuming zero liability here since it wasn't my tenant.

.📍 Market Snapshot (Fall 2025)Occupancy: We're maintaining 95–96% occupancy across our residential portfolio (SFRs, duplexes, small multis).Rent Growth: Up roughly 4–4.5% YOY, but the pace has definitely slowed since the 2022–2023 surge.Hot Spots: Overland Park and Lenexa remain strong.

I do not supply washers or dryers to any of my units as I am not interested in maintaining them.