Because we charge by the bed, returns are significantly higher than market rental rates, even when considering our rent covers ALL housing costs ex food.With today's opioid epidemic rampaging across the US, there is a massive need for well run transitional living facilities everywhere, but it is easy for good intentions to sour when the houses are not run properly.  

Seek out some of the top active Realtors in the Subject's market area and ask them.

If there's a hole, it may be a red flag.b) sensitivity analysis: I examine all the assumptions, and make sure I can live with the worst case scenarios.c) "Stall and see": if they are getting money over multiple years, and there is no penalty for investing later, I would usually wait so I get some real performance data, versus having to look at theoretical pro forma information.d) Recession stress test: I will not invest in anything, until I subject it to recession level stress and see if I can live with the result.

If the new property has less of either asset class (1245 or 1250) then the difference is subject to tax at the rates mentioned above. 

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

Some section8 vouchers only cover 50% of the rent, while others include 100% + utilities!

Hi Matthew, checkout this post i just did on this subject: https://www.biggerpockets.com/forums/617/topics/1161394-call...

I would like to get into seller financing and subject to deals but don't really fully understand the payments portion of it.

I will have enough reserves to cover the holding costs as well as some left over as emergency funds for the property.

The rent doesn't cover our mortgage completely, but covers a good 2/3rds!