I think in some of my STR markets I go grand, but in some I try to target the lowest barrier of entry as in a 2/2 that's easily accessible, small, priced in the lower 20% and that targets young couples, girls trips or whatever they call them, empty nesters, etc.

Hoping to achieve 8.5% - 9.5% once stabilized.

I was primarily targeting properties that were likely to redeem and would yield me at least 12%, so my bidding and research were structured around that.

Overall I feel your goal should be "just enough" to make the prospective (most typical "opportunistic") trespasser move along and find an easier target.

People have achieved your dream in the 80s when rates were in the double digits.

That's how you get the best of both worlds.I will defer to your judgement / answers as you are going to be more of an expert in the area and I am just basing it on spending a few months there and potentially wanting to live there in the future.Maybe I chose a wrong word when I said 'poor'.I stayed in Madrid during my time and I just based my response based on discussions I had with locals and 'high level research' on the internetIt appears that unemployment rate is high in Spain at around 11 percent with a higher rate for those who are younger.A had discussions with many where they are mentioning to go outside of Spain if they want to further their career or get a higher salary.locals have told me that it is difficult to start a business in Spain from getting approval and the taxes are higher for those that are self-employed.My personal assessment, which I think agrees with yours, it will be hard to make a rental work if you target it to locals but if you target it to outsiders, you can make it work.During my stay in Madrid - I stayed in Chamberi, Lavapies, La Latina, Malasana and spend around $60 to $120 a night mostly in airbnb's(basic rooms with basic furniture). 

A real estate agent will have access to the multiple listing service (MLS), which gives you a list of low-cost properties, such as foreclosures and short sales.Find your target marketTo find a potential house to flip, one of your first moves is to find your target market.

Were you targeting a single family home or multi-unit property?

Personally, my investment funds will be targeted elsewhere for the foreseeable future. 

I thrive on the thrill of finding the perfect property and helping others achieve their real estate goals.