Tell them the landlord pays you to also be the PM.If you have much contact with them at all, I'd think it might be hard to pull this off and it may cause you to appear to be "weird" to them if they learn the truth. 

The next thing you get then is this faux mortgage insurance and they try to get 3 to 5k out of you for that.. being that your new and all.. and it has just enough ring of truth that folks fall for it..

Any truth to this? 

It is not what many try to sell and mislead you on its difficulty and the lying you'll have to do and keeping the truth from the Owner/seller by having and paying for 2 closings to keep your profit away from the owner who might be offended by your profit. 

In truth you wont likely make 500K, cost of sale at 1.2 will probably be 70K+ and you will have points and interest on the hard money loan so even if all your numbers are correct you still will likely only make 400K but assuming that is the case Id say do it sell and reinvest the 400K plus your current equity via a 1031 and get a nice 10%+ cash on cash return via 50-70% leverage. 

To tell you the truth, if we could hold every project we do we would. 

The truth is though they bear very little blame for what they are doing.  

So I call the Seller's Agent again and then the truth comes out. 

Although I wouldn't use the term soften in our market, especially in the areas you want to buy, there is truth to the fact that some people who list in Sept - Jan are selling because they need to and not because they want to.

@David Niles Truth!