If you want something you must exercise discipline, make trade offs, and work hard.  

Here is an exercise that I hope you find enlightening.  

If the lease is for two years, how do you calculate a reasonable buy price at the end of the lease if the buyer exercises the buy option?

I'd exercise option 2 depending on applicant's credit score.I came across the same dilemma when I was trying to fill up a rental property late last year.

Once again, this is an exercise that I am trying to wean down worthwhile/important parameters to use not necessarily to use all these on every deal.

If you don't put a contingency on the deal, the buyer keeps your EM if you don't close, assuming there are no other contingencies you can exercise.

Because of that investors here in general are focusing on getting more bang for their buck with multi-family properties with higher rent potential.It's a pretty basic explanation, but it seems like we're in a textbook economics supply and demand exercise. 

Although this is not the best Cost approach, it is definitely the best Risk mitigation approach.This was a really fun exercise for me. 

Fear is a perfectly natural emotional reaction to anything New and Big and Important and comes with Risk.Give your rational mind some exercise.

We've already set the rental price so I guess this is more an exercise for my peace of mind.Thanks,Dan