REI has its limitations, flaws and extravagant laws, STRS are now seeing what can happen to them.

That said some investors do really well with SFR.Your example is flawed for a number of reasons:The 50% rule is a very rough guide.

@Brian Burke   We thought that we were well prepared, indeed we were but this unprecedented event showed some flaws in our battleplan and afforded us the opportunity to "MATH" :) Always love your insight  

Does anyone see any immediate flaws in this?

Yes, the due diligence time is crucial in that it gives the investor time to uncover anything lying under the surface that should kill the deal, but it shouldn't be used as a tool to tie up a property when there's no chance of completing the deal.

These new rules and restrictions were in response to structural flaws in the mortgage industry.

@Shafi Noss One thing to remember, the inherent flaw in the IRR calculation is that it Assumes yearly cash flows are reinvested and obtain the same annual yield as the resulting yield.  

Frankly, I think it's pretty silly to think bad things will not come from this.But when I read your analysis, the potential flaw I see is you appear to assume the future will be as the past, yet the world circumstance today is like never before.

Is this a flaw in their software, are is there really a deductible based on time less than 24 months?

We might be able to uncover something for you.