To CORRECTLY do Build-4-Rent there is never HOPE of appreciation, there is CERTAINTY, mathematical data and insight driven CERTAINTY, knowledge of the appreciation to come. 

It was built in 1928 and had original old-growth hardwood floors in pristine condition other than the smell.

I believe that the ARV I originally thought was correct of 160-165k which after a cash out refi will get me my money back and then be about break even.

I make sure to be there when the appraiser is visiting the home and print out data on appreciation rates and comps and give him/her a personal opinion on where we believe the home should be appraised at.

Lol.Since we live in Texas it doesn’t sound like a prenup is as strong as I originally thought.

Thanks @Abel Curiel for the data on multifamily properties and markets.

It’s so serious that, beginning January 1st in California, any lender who knowingly originates a consumer-purpose loan misrepresented as a business-purpose loan can face criminal charges and jail time.

Check out  - https://www.ruidoso-nm.gov/short-term-rentalsThat is all the data to get started on the permit but still check if the neighborhood has an HOA and what the rules are.

In addition, the capital outlay starts long before any income and the detracting of something from the primary structure even if it is just yard space.As indicated, my original protege made a lot of money (over $500k) on a land transaction associated with a large count ADU development.  

Improved DSCR: If a company’s DSCR has increased significantly since the original loan was taken out, it may qualify for better interest rates or terms, making refinancing advantageous.2.