The ensuing pandemic housing boom saw markets like Austin and Tampa become overvalued by 61% and 45%, respectively.In places like Austin TX, which was overvalued by just 7% in the first quarter of 2006, this feels very new.

Three people showed up with clip boards and a long somewhat heated discussion ensued.  

I think Jeff means that over the ensuing years, prices have kept going up (whereas in a parallel universe, they may not have). ie.

Selling ALL of my Canadian real estate before the inevitable ensuing downturn.  

The ensuing panic spread across Holland, and within days tulip bulbs were worth only a hundredth of their former prices.

They will accept that this is something you do and will respect your ability to manage this part of your life.As time passes on and you find this love of your life and the eventual marriage proposal ensues, the time will come when you’re going to want to separate business from pleasure.

If it's clay it is likely broken in places or if it's galvanized it is corroded from the inside and leaking outside underground.To replace just this one pipe depends on the length of run from the street to the building(s) and if certain sections are under one of your roads or your parking lot.This can cost tens of thousands to a hundred thousand in some cases to fix just to replace the pipe to the building.So that one item only can add up to another 2,500 per door in rehab costs to a 40 unit.Another one is EPA cleanup.You would need to look at what properties are around it for possible contamination and get a Phase 1 report completed.I haven't even gotten into if the building does not have a sprinkler system and the city or county wants one installed to bring up to code.5.You need to look at down trending of rents.With the foreclosures you want to rehab fast and pick from the most qualified tenants to release up.So just on basic info you have posted and not knowing anything else.40 units at 325 rent is 13,000 a month X 12 = 156,000 yearly gross156,000 minus expenses7% property management10% vacancy (your numbers are based off low rent so vacancy upon rehab should be less than going for full market rents)38% operating and expenses55% expense= 85,800 156,000 - 85,800 = 70,200 NOI once stabilized (1 year turn around expected for full rehab and rent up depending on what is needed)Value at a 10 cap is 720,000 before resale costs.Cost per unit for rehab 10k = 400kPurchase price = 150k550k - 720k new value = 170,000 forced equity.You have to remember the level of rehab needed per unit and the expected rents will play a large factor.This is just an estimate.I would find someone knowledgable to partner with if you plan to proceed otherwise you will have angry partners who lose money and multiple lawsuits will ensue when it goes bad.I by no means put an exhaustive analysis here just the basics.

I appreciate your insights so much, and I am grateful for the good discussion that is ensuing here.A couple of quick points in response:Account Closed - My dad seems to WANT to invest.

I go over our lease and let them know what they will be responsible for and that I will bill them and I expect payment or an eviction will ensue.  

I believe that this is bad advice, as I believe that there is a good chance that banks begin calling these notes due at some point in the ensuing 30 years should interest rates rise.Hence, fired lawyers.