This can vary depending on the local Public Housing Authority’s (PHA) workflow and the timing of inspections.5.

@Catherine Curtsinger To play a little devil’s advocate I have been house hacking for 30 years.

This way the investor has a quality property where all the payment is going to the mortgage so equity builds up fast and they can take the re-advanced funds and WAIT for the right opportunity for extra yield plays. 

Their goals and upcoming upcoming purchases may come into play. 

Quote from @Sebastian Bennett: It's funny because I actually had a dream of setting these up and seeing how this would play out lol

Like with anywhere else: location, pricing and the overall house you intend to build will play a factor in your profits.

So, you're not "wrong" in thinking it's complicated.The tax code plays heavily into how certain transactions are categorized and there is some flexibility regarding what we can capitalize versus deduct.

Preference is cash-flow, but open to appreciation/equity plays as well. 

What incentive is there for them to perform well on the deal if they have already made 18k off of you and it is only your money at play. 

I could see a value-play here for monthly financial reporting, if not handled directly through PM systems.