They get hurt by unforeseen costs and change orders.

Did the increased rents over the summer have an unforeseen negative impact on current vacancy?   

What issues do I need to be aware of that addresses profits shared by married partners, and how to handle separation, divorce, loss of ambission, and other unforeseen events?

Why would you spend 135k to build with a lot worth 5k, puts you at a total cost of 140k plus any unforeseen costs that come along the way.

A positive cash flow high enough after expenses to be able to absorb any unforeseen issues is desired, but any cash flow is good cash flow. 

If you're offering a 10% profit to investors, have you considered that maybe their risk in doing the deal might need a bit more cushion in the event of unforeseen expenses?

@Kyle Gregg , You are "improving" your situation only until you have an extended vacancy or a major unforeseen repair.Don't forget to factor in a property management fee..

It’s not earning any real interest, so although I’d like to use some of that $ to invest, it’s there in the event I lose my job or some unforeseen catastrophe takes place (knock on wood)!

After that (if it has already been included on a tax return) you can add the extra passive income to your bottom line which should make it a little easier to qualify for more loans.like everyone else here has said, make sure keep reserves to cover the unforeseen....tenants won't stay very long if they have no AC (especially here in TX) and you don't want to be responsible for your tenants items if you fail to fix a roof in a timely manner.Good luck to you.On a side note: I got my first glimpse of the Texas Hill Country a couple weeks ago.......BEAUTIFUL!!!

There are always unforeseen events that could create new liabilities, income variances or hit to your debt-to-income (DTI) ratio... depending on the strategy or capital structure, some might say DTI is irrelevant all together.