My comment had the assumption built-in that the real estate investor would also be employed at a company that offers a 401k program.When when you pay back a 401k loan as an employee, you are using after-tax dollars.

That being said, they are both trying to model the future of two or three separate investment alternatives, a truly difficult task, and we have to remember that "All models are wrong, some models are useful" At the end of the day, the inputs and assumptions of the calculations are much more important that the actually math.

Assuming that the current cycle will exceed the previous peak before turning down is not a safe assumption, especially in markets that lack strong underlying fundamentals. 

We also buy very unloved buildings under the assumption that we will be gutting the building and replacing almost everything ... so typically do not bother with engaging an inspector or engineer unless we see something out of the ordinary (in a bad way) or we are having a Phase 1 done.However, in the beginning before we had acquired our present level of comfort and experience, we sent an inspector into most buildings ... if for no other reason than to provide input into maintenance and renovation planning.

We knew there was water in the scrawl space, but our initial assumption was it was just groundwater since we’ve had a lot of rain in Maryland and the Annapolis / Baltimore area.What’s actually happening is the water is coming from the front right corner of the house, where the sewer line runs, plus there is a gap in the foundation in that same area that needs to be sealed.

Not an assumption.

My assumption (which could be what is causing my confusion) is that a homebuyer who is seeking a lower monthly payment for two years is doing so due to financial constraints and needs time to adjust to a mortgage payment and the expenses that come with owning a home. 

I hate to make assumptions but California investors are known for not being wise when investing here in SA.

Is that a correct assumption?

This isn’t an issue I’d make any assumptions about.