For a conventional investment property loan you will also need 12 months seasoning to do a cash out refinance.

He can give you some general financing guidelines that can refine your search and forward some listings for reference.

Then after a year refinance into a conventional since most experts say they will drop by that time, and do it again. 

Let's say you put 15% down on an investment property (2nd SFH, New Construction) and with property taxes, homeowner's insurance, and PMI the monthly mortgage is $4,300However, in the market (location), most of the rents are around $3,500-$3,700With an interest rate of 7.6%Would you still buy the property knowing that you'll lose $800-$600 per month, but hoping to refinance at a future date (4-5%) to have cash flow, and also with appreciation since it's a good location and it's a new construction?

I plan to refinance when the rates go down. 

There are many homes in areas outside of Claremont that are selling for $500k to $650k Many of the people we know are buying homes like this one with a construction loan for the ADU ($100k) and buying a home for $700k + $100k : $800k total at 5% down payment and ending with a total payment (PITI) of $6k minus $2k rents from ADU Total new payment of $4k which is easier to make and once interest come down some, they will refinance to drop their payment to $3k to $3,500 per month. 

My friend wants to include me in on this so we can both achieve financial freedom together.The plan currently is to take out a personal loan together for the $20,000, put in $5,000-10,000 worth of work into the property to make it livable as soon as possible, move into the property ourselves so we don't have to pay rent anymore, and then refinance as soon as possible.

You can still add value and then refinance a property, which is similar to the BRRRR method.

When we finally move to SD permanently  I plan to refinance, pay it down and reduce the loan.Does this seem like a reasonable plan or should I allow the 3% rate to lock me into that rental even though I want to use that equity to buy in SD rather than wait several more years, till I save up more for a down payment to buy in SD?

This led me to refinance my 3 property portfolio to pull some cash out in order to buy 2 more.