I just did my first town and the units available per headcount seems really low.

Located about 1/2 mile from the base of Sabino Canyon recreation area and Coronado National Forest, beautiful mountain views, cut-de-sac, very nice neighborhood.  

The denominator in the calculation is your capital/equity and with no debt the return on your existing equity is low.

When revenue is low in the first couple of year, so is the interest payment.  

They use leverage in some of their funds, which can increase returns, especially if they have a low cost of capital (but potentially increase risk and trigger UBIT issues).

If you can save up for a slightly higher down payment your margin for success will be significantly higher.Also, I strongly agree with the "buy the worst in a great neighborhood, live in the worst unit of the triplex and slowly fix it up yourself."

Question: assuming an ideal brrrr that has all investment extracted at the refinance, why would you choose a low cost market over a high cost market?

The current rents are really low because the tenants are responsible for doing any and all repairs on their buildings (which in my opinion contributes to the poor condition of the buildings). 

Because, it's way too low. 

Every Market (Detroit) has a series of Micro-markets (neighborhoods) of which they are all different in cost, value, cash flow, rents, etc...