Impressive Rent-to-Price Ratios: Average rents for 3-bed homes are about $800-$900/month, potentially yielding 12-15% gross returns.Economic Transition: While historically industrial, Bay City is diversifying into healthcare, education, and service sectors.Revitalization Efforts: Downtown redevelopment and community initiatives are breathing new life into the city.Strong Cash Flow Potential: Low property taxes and insurance costs contribute to robust monthly cash flows.Let's crunch some numbers on a hypothetical deal:Purchase Price: $75,000Down Payment (20%): $15,000Mortgage (4.5% interest, 30-year fixed): $304/monthProperty Tax: $100/monthInsurance: $60/monthEstimated Repairs/CapEx: $100/monthProperty Management (10%): $85/monthTotal Monthly Expenses: $649Potential Rent: $850/monthEstimated Monthly Cash Flow: $201Cash-on-Cash Return: About 16.08% (not including appreciation or tax benefits)These are rough estimates, and individual properties will vary.

In my initial research, I'm finding a pretty big disconnect with the deals that Michael implies in the book and what is actually out there. 

Cashed out refinanced and got our initial down payment back.

If there are excess funds after paying the local/school real estate tax bill, the remainder can go to:Current real estate taxesCurrent Muncipal liens for water/sewer or any other bill initiated by the municipalityState Liens, usually for outstanding state taxes, sometimes employee/employer taxesPA State Inheritance Tax which applies to all deceased owners and starts at dollar one with no exemptions, unlike the Federal Estate Tax. 

If a renter wants to extend for a few months their stay beyond the initial lease term, will I be a) required to extend and b) at the same rate as their existing rate?

Or is there going to be understanding for digging deeper when the initial screening process produces these apparent inconsistencies?

I just recently read, after my initial post, that meals with clients are 50% deductible if not "lavish" in price. 

The bill proposal is in its early stages so I won't pretend to have all the answers, and I agree that subsidized housing initiatives need some work. 

Im happy to answer any questions you may have from an initial strategic stand point. 

This negative equity position will consume the initial cash flow.