Estimates range from $3-500B of property insured with the FAIR Plan and between $3-700M in liquidity with up to $3B in re-insurance.

That alone can kill a deal due to over the Max DTI limit.A cash out refinance is tax free and its an immediate liquid reserve so it can be used as an Asset or PITI reserves.

Brandon,Check out Indiana & Ohio for states that you can buy 2-3 for that amount of liquid reserves. 

I originally used liquidity from a refi, HELOC, and a personal LOC to make the purchase and then refi'd that money out after closing.

I believe their is a strategy here to acquire, stablize and liquidate along the way to build a self funding cash machine.  

I also think most markets won't see anywhere close 6% cap rates (for single family homes which is what I personally invest in).The questions you get to ask are then:Is the extra 4% worth the hassle of management and lack of liquidity.   

Meaning truly intrinsic(2x DSCR not 1x DSCR), then roll the dice and lever the minimum you need to get the deal done and understand to put more to reserves than anything else for the first 3-5 years from your current and new property.The risk:reward ratio is very low when you factor in a lack of liquidity.

Now the issue of attaining liquid cash.

If we face any headwinds, liquid investments go first so probably crypto but then you bet equities will get pressed.

This either sounds like a seller looking to "retire" and liquidate his holdings or a Section 8 owner that hasn't kept the property (or rents) up to market levels.So, based on the numbers you're using, what return (IRR, Equity Multiple, or ConC) are you estimating you'll generate over your expected holding period?