This strategy allows for a relatively fast recycling of cash and free cash flow.The market has shifted hard and appreciation is not on the same trajectory as it was a few years ago, but it does still exist especially if you can force it. $200-$300k of appreciation on day one on a sub $1M property in the Bay Area is pretty good.

There are all sorts of laws your contractor may have already violated and if he is licensed then the contractor's board or agencies that have jurisdiction don't take these violations lightly.So, before you meet with your contractor, you need to do your research for the laws he is violating in your state and present this list in a diplomatic way to your contractor in a way so that you only want to inform him that if he doesn't comply with your requests you may go to Plan B and report him so that he will have to deal with the agencies to complete your job because you have reached the end of your rope and make the end of your rope very clear.You can't just fire your contractor because he will love that action, totally walk from the job and say he planned to finish the job, but you breached the contract and this will be his argument if you decide to go to court,If you think you can take him to court to recover any loss or damages you can forget that because your attorney will milk you for $30,000+, keep telling you that you have a great case as long as you pay him and after 5 years you will get nothing from a scumbag contractor who has nothing.

recycle place? 

He's a one hit wonder and he keeps milking it.

Indeed, we could purchase some we’ve seen for cash but our goal is to use as little money as possible of our own and of course to recycle it over an over.We are faced with a decision, as we have plenty saved for a down payment, along with money for repairs or capital expenditures and holding costs.

But I think your headline about infinite return being BS has valididty for another reason: in order to achieve 100% cash recycle rate you have to keep the remodel superficial. 

What I’m trying to understand is why everyone thinks we’ve hit the later stages of this RE cycle.

You need to find a strategy that lets you recycle your liquidity.

You will clean the surfaces, empty trash, shred the papers marked for recycle, vacuum the floor.

And I'm not opposed to keeping the earnest money if they try to milk the contingency.