It depends on the insurance company and rates you are going for.For example some insurance companies only insure brick buildings in certain areas built within the last 20 years.The reasoning is you get ultra low rates by having a low risk pool of properties.Insurance companies have told me with buildings 30 years or older some do not like to insure unless all mechanicals,plumbing,electrical has been replaced.The reason is statistics shows a high volume of claims happen after that age from things wearing out.With 4 units or less many just get the cheaper fire and dwelling coverage instead of a commercial policy.If the premium low rate insurers won't touch you there are companies who will give the policy to more properties deemed high risk but the policy of course will be higher and usually the deductible is too.

I think the market supports this as some 2 bedroom house around me go for 1.5+ and are very hight end, some of them even ultra modern which I love.

@Dan C.It will be harder to rent and harder to sell.I avoid any street with a double yellow line, commercial areas, mixed use, noxious neighbors, ultra small or ultra large houses.I want properties in residential areas with good schools, low crime and predominantly owner occupants.

The investor backers with the family offices are ultra high net worth ( hundreds of millions to billions in wealth ).When you have that kind of money you do need to squeeze immediate return.

Also-- do you recommend ultra or regular?

@Jim Hiler  I don't do ultra high end.. but I do some mid rise stuff and I did do one  5,000,000 dollar spec successfully.And I am a RE broker. 

My market, Northern CO, is ultra super red hot.

When I read his report I saw he was using an ultra-conservative cap rate of 12.2%! 

Lots of mistakes on Zillow and besides, those ultra low prices mean nothing....could be family transactions or a host of other things.

Any feedback helpful;  shadowing a closing process would be ultra-helpful.