You don’t need a signed lease or to hand over the keys; as long as the property is ready for tenants and you could rent it out, you can start depreciating it.Since your property is currently being remodeled and listed for sale, it generally wouldn’t be depreciable yet because the IRS considers it held for sale.

Quote from @Paul Novak: I am curious how other people have come to determine when enough is enough on purchasing more real estate and if/when to pay off their properties?

In most cases, the property manager ends up being the one truly running day-to-day operations, which makes it hard for the IRS to see you as “materially participating.”To meet REP requirements, two things have to happen:-You (or your wife) need to spend more than 750 hours a year on real estate activities, and-Those hours have to make up more than half of total working time for the year.The challenge is proving that level of involvement when a property manager is already handling leasing, maintenance, and tenant issues.

Quote from @Matthew Hamilton: There isn’t really a “penalty” for having the property as a rental for three years, but you may lose eligibility for the federal capital gain exclusion if you hold it too long.Here’s how it works:The IRS allows you to exclude up to $250,000 of gain if single or $500,000 if married filing jointly when selling your primary residence, as long as you’ve owned and lived in it for at least two of the five years leading up to the sale.Since you moved out in March 2023, you’d still meet that “2 out of 5 years” rule if you sell by March 2026.

The most critical tip is to start by determining whether (and also when) cost segregation can help you in your particular situation:https://www.biggerpockets.com/forums/51/topics/1075919-five-... 

Even if you could, you still need the lender's appraiser to determine the value for the purchase.

You’ll want to review how all of this interacts with your current income streams and overall financial picture to determine the best approach.

Imagine an IRS auditor watching 100 hours of GoPro recordings, and hearing heavy breathing and grunting as you clean.  

Not too hard to determine if you’re a real estate investor or a flipper.

So we work backwards from there to determine the price you could pay (which is also largely dependent on the loan type and terms).