The other attempt at affordable is density through what they call their middle housing zoning and up zoning existing parcels. again led to building boom but still nothing sells for much less than 500k.

Again, I like the idea of a new fourplex, it just seems like you’re glossing over alternatives/possible problems. 1) You say you want to hold for cash flow instead of taking $120k cash by selling as soon as it’s built.

Many builders won't sell to investors, but even the ones that do, maybe have restrictions or change restrictions down the line. 

If the location is an A but the tenant paying higher rent was a B or a C then replacing the location with an A tenant at slightly less rent in some cases you can actually increase the value.Example if you had an (A) location QSR but tenant was Burger King franchisee and they went out the Burger King might sell at 7 cap.

I own a duplex and am selling it.

We bought for $379,000 3 years ago and I could sell it today if we wanted for $475,000.

Forcing the seller to sell because they initially agreed can be a recipe for disaster later.

Quote from @Luis Pereiro: Quote from @Jay Hinrichs: what position that's an important factor.. bare land notes generally sell for a 20 to 30% yield. 

I guess we could maybe have the builder agree to the cost of the build and if we sell for more or less then the profits would go up and down based upon the selling price.

Periodically checking the realtor.com and zillow "sold" listings in your areas of interest will keep you generally informed on what properties are actually selling for.Feel free to reach out with any questions during your research phase, happy to share some additional stats/info.