Additional Info —Key Details:Location: Outside Santa Fe, NMProperty Size: 20 acres (valued at $80,000)Project: Two new STR unitsExisting Experience: Family has two fully-occupied LTRs nearby, generating $2,000/monthConstruction Approach: Self-contracted with licensed trades for electrical/plumbingCost Assumption: $80,000 per unit, plus ~20% for inflation (based on 5–8-year-old build costs)Financing: Using land equity as down payment on construction loan (expecting closing costs to be major expense)Request: Looking for feedback, potential pitfalls, and general guidance

Sometimes, there is also a tenant already in place which means you can start generating rental income from day one.

When you invest in 1-4 units residential property in the Bay Area, you are investing for the appreciation or value-add potential because most properties don't generate positive cashflow.  

If the market rents do not cover the mortgage, you may do a no ratio DSCR for a higher rate/reduced LTV  Which most likely the 1007 will be nowhere near the revenue generated by a PadSplit operation.

A formal business built on this seems overkill as you’re essentially paying someone for a service that already has standard model.If you and the parnter have distinct business tasks/abilities (i.e. not what you would hire an agent or contractor for), such as off-market lead generation, that’s a different discussion.

regarding roofs  pray for hail storms and then replace .. in those type assets that are really priced for cash flow.. values will rise only when rents rise.. as non of them will ever go owner occ.. at least that is generally what happens with this type of housing.. the value play is the tenant pays off your home and your home generates enough cash flow to break even at best and feed it a little bit over time.. then at the end of your mortgage term 30 years you now have say 2 mil of paid for assets the real money is made on these assets cash flow wise ONLY if you pay cash IMHO

so if you're impatient and just buy something random it's not going to work and you'll just set yourself back.

They just generate chlorine at a constant rate depending on the system setting.  

The second you are introducing metrics to change your marketing that have nothing to do with generating the leads you need, you introduce uncertainty to your systems. 

With this, along with shifting the utilities to the tenants and reducing the management fee to generate an NOI of around $103k, I'd estimate the value around $1.8M to $2.0M