Due to increased rates i did not refi so i did not get opportunity to see how an appraiser valued the half bathroom but the comps with same bathroom count had crazy valuation for the additional half bathroom.Taking under utilized space like a work area to add a br where the added br does not put you above the normal for the area can add value.Similar if a neighborhood is virtually all 3 br and 4 br properties and you find a 2 BR, it could be a value add to add the bedroom via new construction.  

Interest rates NEVER matter and you can make money all the time.

Prices are a little soft in Memphis at the moment, but I think that will change when interest rates go down some more.

Rate is 4%.

When we create our business plan, we also include our exit plan.We'll only proceed if we can clean this up, acquire new tenants at higher rents so we can increase our NOI, which in turn should reflect our cap rate and profits.Since this asset class is new to us we will tread cautiously.Scheduled to preview tomorrow. 

There is a lot more to it than the rate.

My gross income is a bit less than $7k (and I'm renting near top of market rates) with minimal repairs ($2k/y), but...1.

It's a combo of low housing supply, higher interest rates vs. seller expectation, and a poor economic outlook for the country.As an investor with a few rentals it's like like the parking brake is stuck on.

I always run the numbers with long term rental rates.

What is occupancy and rate and how does that compare to your competition?