The builder is just leveraged to the point that he cannot afford to turn his n the power and he needs to liquidate the property.  

In short, this market has a huge barrier of entry and it is capital or very strong borrowing power and usually both.There are lenders who will lend to a no exp investor, but not some 500k Long Island property that needs 200k in work and will resell for 1.2 Million. 

How much time do you have and what is your investment strategy, fix and filp, BRRRs, STRs, buy-and-hold will require different hunting techniques. 

We want the to be able to have more buying power later this year as well so we don’t want to jeopardize the debt to income ratio of both of the  partner?

But the power of a house hack is not from the cashflow after you leave, its in the immediate reduction of living costs you get while living there and the incredibly low down payment options you can use.  

Joe that is the way its suppose to work and exactly how we did our sub toos  as you point out though when this technique starts to get marketed to the NO money no Credit RE crowd its going to cause some severe headaches for Sellers and Buyers.you hit the nail on the head of Chris's situation I am guessing and if I was buying paper like his fund does I would do EXCATLY what he is doing buy discount have the right to accelerate and get cashed out spins the APR meter dramatically for an investor or a fund. 

For distressed properties I intend to keep as rentals, the buyer pool is greatly reduced and being able to close cash and waive inspections provides a lot of negotiating power. 

If you are buying the $1.5M+ mix-use buildings the buyer pool is much smaller and there's far greater negotiation power on the part of the buyer.

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If you want to put more brain power into it and potentially make more money I think closer to downtown could be a good fit.