If private companies continue to provide the insurance, I suspect we will see further increased premium costs which will need to be reflected in the rents tenants pay (all tenants: LTR, MTR, STR).  

Startup costs paid out of pocket should be recorded as capital contributions and may be deductible as startup expenses or amortized.

These costs would eat into your profits.The case for sellingEven at $125/month, your cash flow is slim, and any unexpected expenses could turn this property into a liability rather than an asset.

If a prop is 250k and you can refi at 70% LTV you want to get it at 175k minus rehab costs.

A good landlord understands that vacancies & Rent-Ready costs will destroy your cashflow and profits.

Several economic factors are contributing to this shift:Overbuilding: Some areas of Charlotte have seen significant overdevelopment, leading to an oversupply of rental units.Tighter Money: Rising interest rates and economic uncertainty have made tenants more cautious with their spending.Tenant Behavior: Many responsible renters are choosing to stay put rather than take on the cost and hassle of moving.What Does This Mean for Landlords?

It is fair to express your disappointment that they exceeded the cost target you gave them. 

Travel costs to look at other properties.If you travel but have not identified the property that you want to buy yet, the cost is considered an investigating cost.

I expect the work to cost about $150k plus or minus $20k.

You could also get a line of credit for about $150k (you should be able to borrow 75% of the value.)The reason I suggest this is…1) you save $40-$60k in selling costs. 2) you have a lower blended interest rate (2/3rds at 3.25% and 1/3rd at 7 or 8% instead of the whole $500k at 7 or 8%) saving you another $1k/mo in interest. 3) you only pay interest on that $150k when you actually use it, not from day 1  Unless you hate this property, or want to buy something you can’t afford without selling, that would be my plan.