Yearly increasing costs will, in time, eat up any profit they have per unit.

While under contract, we perform due diligence and there will be some soft costs incurred. 

If you were able to increase the value of the property significantly after the rehab, then you could bring the deal to a community bank  to refinance and take the hard money lender out.You keep all the equity and don’t have to file a partnership return for your annual tax return, which can be costly.  

Begin by targeting distressed properties in gentrifying neighborhoods, securing financing through hard money lenders or private investors, and focusing on cost-effective renovations.

Double the cost of that house and double the rate to 7% and its like $4,000 per month for the EXACT SAME HOME. 

Refinancing has more nuances than it seems, and so do closing costs.

It’s definitely smart to evaluate the tax and cost implications of your funding options.

I have "XXXX" of debts every month, and make "XXXX" every two weeks.That will find the cost of duplex you need, though you may need to verify it is using current FHA guidelines as they have changed recently, so make sure you use that. 

To qualify for a loan, focus on having a credit score of at least 620 (or 580 for FHA loans), keeping your total monthly debt under 43% of your income, and saving enough for a down payment and closing costs—about 5-10% of the home's price in total.

@Dhruv Patel I believe you are getting ahead of yourself....Where in the US are you all-in (land acquisition, soft costs, hard construction) on new construction multi-family for $100/ft.