Keep in mind that landlords in expensive markets aren't making an profit (cash-flow) on rent.

Here is what I know-$250k Strong (my client) = 1/3 = 7.33 Units Each$250k Elena/Investor = 1/3 = 7.33 Units Each$250k Mike/Builder = 1/3 = 7.33 Units Each$250k Investment = Profit $2 to 3.3 million.Purchase $2.2Build Cost $4.1Total Cost $6.3ARV = $12 to 22 millionProfit = $5.7 to $16 millionConstruction to take 18 monthsI am meeting with a lender and the developer, Mike today.

Quote from @Rajagopalarao Paidi: Is there anyway to minimize or avoid agent costs, I don't have much scope for profit if I pay agent costs, what options typically one has Do it FSBO if you want to save them and then hire a TC or company to do the work...

The possible lack of profit that is left behind.

Determine local/state laws regarding wholesaling and determine if (1) you need to be licensed in the jurisdiction you’re considering and (2) if you’ll be able to operate profitably while remaining legally compliant2.

Nobody knows so what I do is making sure I'm profitable, even at rock bottom rents.

Just make sure the cost of your protection doesn't rob your profit. 

Of course markets change and the chances of a profitable flip have changed as well.

You'd have to be a builder to really reap any sort of profits from an area as such. 

Just like any other investment, if you take into account all your costs and buy at the right price, you can still make a decent profit.