$3.33M Reclassified on a 151-Home Single-Family Rental Portfolio in Kansas and Missouri
A single-family rental investor had 151 homes in Kansas and Missouri studied in the same year they were placed in service. At a median purchase price of $85K, any one of these homes is a small study. Across the whole portfolio, the studies moved $3.33M of depreciable basis into shorter recovery periods.
- Rental homes
- 151
- Combined purchase price
- $13.36M
- Reclassified
- $3.33M
- Share of basis
- 27%
The portfolio and the result
The 151 homes had a combined purchase price of $13.36M and a depreciable basis of $12.27M. The studies identified $2.36M of 5-year property and $988K of 15-year property, about 27% of the combined basis.
Every home was studied with USTAGI's modeling approach, built for residential property of one to four units with a building basis under $1 million. It applies engineering-based cost models to each home's data, which keeps the cost per study in line with the size of the property, so studying an entire portfolio of modest homes still makes sense.
How the combined basis was allocated
| Category | Amount | Share of basis |
|---|---|---|
| 5-year property | $2.36M | 19% |
| 15-year property | $988K | 8% |
| Remaining building basis | $8.92M | 73% |
A typical home in the portfolio
- Median purchase price
- $85K
- Typical age
- Most homes built between the 1910s and 1950s
- Median 5-year property per home
- $12.8K
- Median 15-year property per home
- $5.6K
How the studies were done
- Study type
- Modeling study on each home
- Property types
- Single-family rental homes, plus a duplex and a home with an ADU
- States
- Kansas and Missouri
- Tax year
- 2025, same-year studies
- Placed in service
- 2025
- Client
- One single-family rental investor
Questions about this case study
On its own, a home at that price produces a modest result, which is why USTAGI offers a lower-cost modeling study for qualifying one to four unit properties. Across 151 homes the modeled results added up to $3.33M of basis moved into shorter recovery periods.
A modeling study applies engineering-based cost models to a property's data instead of a full on-site engineering inspection. USTAGI uses it for residential property of one to four units with a building basis under $1 million, with eligibility confirmed case by case.
Yes. Most of these homes were built between the 1910s and 1950s. Recovery periods are based on when the owner placed the property in service, not when it was built, so an investor who buys an older home starts a new depreciation schedule and can study it.
No. $3.33M is the depreciable basis the studies moved into 5 and 15-year property. The tax effect depends on the owner's tax rate, bonus depreciation eligibility and overall tax situation, which their CPA determines.
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Results shown are from completed USTAGI cost segregation studies and are not a guarantee of future results. The client is not named, locations are shown by state and amounts are rounded. “Reclassified” is the depreciable basis the studies moved into 5, 7 and 15-year property; it is not a tax-savings figure. Outcomes depend on each property and each owner’s tax situation. Consult your tax advisor about your situation.