It was priced at $105K.... in fair/poor condition... it was still an amazing deal. 

From that vantage point, Id be fair and offer possible mitigation and light concessions.

You could go with:Step-by-Step Increase: Let them know the rent will be going up gradually, maybe $100 every 6 months, until they’re paying fair market value.

It's a gamble unless you're experienced and know what you're doing.

Hi everyoneWow, it's been over a decade since I was on BP, nice to be back.My business partner and I have a fairly large portfolio of SFH's that we purchased as rehab projects using hard money. 

Here’s the situation:Key Project Details:•Property Size (pre-renovation): 250 sq. meters (2500 sq. feet)•Purchase Price: 250,000 EUR (1,000 EUR/sq. meter)•Renovation Costs: 750 EUR/sq. meter (includes kitchen, appliances, quality furnishings)• Loan costs (during renovation and renting): 350 sq. meters (due to attic expansion)•Property Size (post-renovation): 350 sq. meters (due to attic expansion)•Post-Renovation Layout: 2 separate apartments•Airbnb Income (24 months): 2,500 EUR/month/apartment (= 5,000 EUR/month)• Other running costs: 600 EUR/month•Projected Sale Price (after 2-3 years): 850,000 EUR (approx. 2,500 EUR/sq. meter)•Closing Costs: Negligible in Tbilisi•Real Estate Agent’s Fee: Typically 3%, but negotiable based on who hires themFinancing Setup:•Property Purchase Financing: 100% bank financing at 5.9% interest (bank has even financed 150% to cover some renovation costs in the past)•Renovation Financing: Our friend is offering to finance 250,000 EUR in cash for the renovationsProposed Partnership Structure:•Work Involved (on our side): Full renovation (10-12 months to complete), furnishing, and property management through Airbnb until the sale (2-3 years)•Profit Split Proposal: 60% (us) / 40% (friend providing renovation financing)Questions for the Community:1.Does the proposed profit split (60/40) seem fair, given the work we would handle (renovation, furnishing, property management)?

Fees are generally higher on small loans, but that seems pretty fair 

I’m renting the property for fair market value. 

I am a great negotiator who ensures all parties are treated fairly. 

This is a fairly common issue with older properties  where root structures create a dislocation in the line causing constant backups and the only remedy is replacement.