Very profitable How did you find this deal and how did you negotiate it?

They must be organized, compliant, have strong well-priced vendors, quality marketing and timely tenant relations.

The 1% rule and the 35% operational expense rule serve as benchmarks to quickly evaluate the potential profitability of a real estate investment.

Otherwise, this COULD be a profitable deal.  

Also, if you pay your parents any profit for the property, if it is their primary residence, I believe that a married couple has up to $500,000 exemption on profit from a primary residence, I'm not 100% sure on that, but you can search for that pretty quick.If you are looking for any loans, please let me know.

For example the building may not fall under the rules of the FHA if it is owner-occupied with 4 units or less, if it’s a single family home rented by the owner and you have less than 5 rentals, or if the property is operated by a religious organization or a private club.

Hi Maria,When flipping properties, cutting costs on materials can significantly boost your profit margins, however, you always want to maintain a minimum quality so my first advise on how to spend less is to plan the rehab in a way that optimizes the value return you're getting.

If you plan on selling it, I wouldn't take out a mortgage if you could do it with cash as financing will eat into your profits. 

When sold the percentage of profit allocated to the primary residence should be able to come to him tax free (the first $250K of profit if single or $500K if married. 

I've seen all sorts of structures from 20-35% of the budget to a precentage of the profit.