ARMs are the perfect way for a bank to hedge itself against inflation. 

At that point it's mainly outpacing inflation and keeping the money safe. 

Value add off market is your best play for big gains in an over inflated market.

This will also hedge against inflation. 

He's definitely trying to just take a larger cut by inflating his build cost ... which honestly would be fair if he was just upfront about it.

That is a nice property, unfortunately I think you are just falling victim to a saturated STR market that saw a decline in people using STRs after a couple years of inflated numbers of people coming here during / post Covid.Nathan brings up a good point about throwing more money at it. 

This is even more true if is section 8, where the rents are inflated normally by being benchmarked to some metric that includes higher rent properties but where the property prices to buy are still depressed because well its not a great area. 

But they have seen another trend - Real Estate follows inflation.

Let's look at a time window that had inflation/interest rates like they are now.

We're also able to evaluate our rates, and keep pace with inflation, on a monthly and quarterly basis because of shorter term leases.These syndication can provide an 8%+ cash-on-cash return - providing you monthly cash flow - and a 15-20% IRR over the length of the project.