Probably 8%+ mortgage interest at 40% down to make a safe assumption.

This creates two loan payments ($100,000 of equity and $300,000 on the new mortgage).Key NumbersHome Equity Loan Interest Rate: 6%Mortgage Interest Rate: 7%Rental Income: $3,000 per monthExpenses (management, taxes, insurance, maintenance): $800 per monthIncome and ExpensesMonthly Rental Income: $3,000Monthly Expenses: $800Monthly Mortgage Payment: $2,000ExplanationThe investor earns $3,000 in rent each month.They pay $2,000 on the investment property mortgage and $800 on other expenses.This leaves $200 profit each month or $2,400 per year.However, you have to pay $6,000 interest on the equity borrowed.This leaves you with an annual loss of $3,600.While the rental property generates positive monthly income, the interest cost of borrowing the initial $100,000 results in an overall loss.

Those stilled cashflowed mostly due to insanely low interest rates.3) Investors started chasing Class C rentals in 2022 when Class B rental prices AND higher mortgage rates didn't allow cashflow at purchase.4) Investors are now chasing Section 8 tenants as the cure-all for Class C tenant performance issues, so their Class C properties ACTUALLY cashflow.

If you're considering hard money loans, they can provide fast funding, but with higher interest rates and shorter terms.

Great job and congrats!!! 

Quote from @Scott Mac: It might be the investing environment.Right now we have a different interest rate picture then we had a few years ago.

What made you interested in investing in this type of deal?

Sounds like a great deal/property.

When looking at properties in other cities, I usually start by researching market trends like price-to-rent ratios, crime rates, and growth potential.

There are also case by case opportunities within the North Phoenix market where rental rates are stronger.