Don't rationalize a bad decision saying "there is demand" and "all properties here go for a premium".

If owner pays for any other utility, expense ratio could even exceed 60%.Don't worry about what seller or listing agent or even buying agent claims regarding expense ration, do your own due diligence. 

Rehab cost is about $70K. 8% fix int debt ratio 2.39( I would prefer to take $20k out of what I put in if I convert it 5 unit which make my loan amount $90K) 8% fix int debt ration 1.93Monthly Cash Flow $605 The only Multi-Unit (2- 4 unit) that has sold in last 3 months that's within 1 mile radius of the property is a 2 unit for $140,000.

I use all private money to fund most all my deals at this point, cost of money is figured in as an expense, so there is no coc return ration figured in my calculation.

I think these professionals are acting rationally in overspending in the early years - please google "permanent income life cycle hypothesis" for an explanation.

I want to know what the investment rational is, what is driving a market, etc.I don't follow stocks, I do have clients that do well in stocks though.

The shrewd buyers get out of the way, but you have the "auction effect" takeover at least couple bidders rational and run up the final price 15 - 20% over list.

What he provides  is  the deal and he splits it by some ration with the person who funds it.  

I have read many articles that say not to invest outside of your market and I can understand the rational and challenges involved.

This is the general paradigm for how landlord-tenant relationships are structured today.We do have a significant amount of positive property owner reviews on other sites including Google and TrustPilot.That's the most rational explanation I can think of.