It's a crap return if you buy at $460k in 2020.I'm guessing the property has appreciated to the point that the sellers are now sitting on a pretty low ROE, and are trying to cash out at the expense of unsuspecting buyer, so that they can deploy their capital more profitably.Apples and oranges, I'm afraid.

“In a QOZ fund investment you have to deploy ONLY the net equity in a replacement property” to defer the capital gains taxes?

I have just returned from deployment and, I am using my VA loan for the purchase.

Sure the rate is a little higher, but if you're only deploying that capital for 6-12 months, it's negligible.On the other hand, if you want to do a larger MFR as a long-term buy and hold, it might make sense to do a refi and use the money as a down payment.

He deploys overseas for 8 months this year, which means I will be working full time and caring for our children. 

That mortgage payment will be ~$685, then add in repairs, CapEx, vacancy, management, taxes and insurance...Take your gains and re-deploy your capital where you'll see some continuing returns.

Purchase price: $225,000 Purchased new home in 2013, deployed in 2017 and rented it out for a year and a half.

You have to move the money quickly because its the velocity of the capital that makes it work, meaning how fast can you deploy your capital and then have it come back to you.

Just make sure you invest to yourself first before you start deploying your $100k.

I am currently deployed overseas but will back in a couple months.