Hello,

I need to buy a house for my aging parents which then they will rent from me. I have enough cash to pay if I have to. Here are some specifics. The purchase price will be about $250,000. They will pay $1100 a month in rent. I will likely keep this after they pass and rent for a market rate. Taxes and insurance will be about $3,000. We are in the 37% marginal tax bracket. The mortgage rate is about 4% for a 30 year fixed. The real estate market high is quite strong and I'm assuming at least a 3% gain every year for at least several years. The money I have in cash I would like to keep in a lower risk lower yield investment.
My question is it better to pay for it completely in cash, mortgage it completely or some combination thereof. Unless I'm thinking about this wrong, my concern is largely taxes. If I pay cash, most of the rental income will be taxed at 37%. If I mortgage it, the interest will be deductible and I could put the cash somewhere else and maybe get a higher yield. Thoughts?

Any help will be apprecited.

I didn't find the right solution from the Internet.

References:
https://www.bogleheads.org/forum/viewtopic.php?t=241039
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Thank you.