I would like to purchase a 4 unit building in NKY in 2025.

The best I've seen for STRs is 80LTV on purchase and 75LTV on cash outs. 

@Frankie Lotrec if you have an existing loan on the property and you plan to legally convert from a 4 unit to 5 unit , you should check the loan documents because you’d essentially be converting it to a commercial property, since 5+ units is considered commercial and subject to different appraisal approaches and so it would rule out the property being considered for purchasers utilizing residential financing.  

Quote from @William Dorrough: I currently either purchase and value add large scale multifamily properties or develop, and build ground up my issue with scaling is we have done this without brining in investors i have a great deal flow with a good track record im really looking to do more i have the capacity but have the need for more capital in one way or another  Scaling without investors can be tough, especially in multifamily.

The best way to learn the multifamily market is to purchase a multifamily property.

I had a flipper come to me asking about doing a new development.He would need $240,000 to purchase the land from a wholesaler and then he would have his GC partner get the construction loan but they cant get the loan if their is someone else that has a lien on the property so i would have to collateralize against one of their assets which they don't have.

@James Boreno You’ll likely owe taxes, but don’t forget to account for your adjusted cost basis, which factors in the original purchase price, depreciation over 10 years, and any capital improvements.

This allows you to use all of the tax and deferred depreciation recapture to purchase the larger MF propertyA consolidation exchange is where you sell multiple investment properties to purchase a larger and nicer investment property, but you also get the benefit of using all of the tax you would have had to pay to your advantage.

My question is do I go forward with purchasing the property and deal with the higher insurance and potential hazard or is it smarter to walk away?

Most buy the entry level SFH because its what they are qualified to purchase.