This is part of why I chose a lower LTV was to keep positive cash flow while still enabling me to pull out 19k to keep as reserves for the property which has proven especially important with the onset of the COVID-19 pandemic.Doing this project from out of state presented a lot of challenges for me and I relied heavily on the contractors and my PM to provide me with updates, pictures, lots of phone conversations, and a great deal of learning for how to navigate a long-distance rehab.

A true, permitted ADU is extremely rare because they are expensive to build, the laws enabling them to be built more easily just took effect in 2019, and as both sides can be rented separately they can be held and rented as a duplex (often offering a great return) rather than sold. 

I am posting this because I want to thank Josh for creating such a valuable resource for all of us that it enabled me, in Arizona, to find an investment partner from around the world.

Each type of asset has its advantages and weaknesses, and having a mix enables the savvy investor to capitalize on each asset class's strengths and to diversify risk. 

Your mindset sounds perfect;  setting up the long term plan in the back of your head, while you work on the short term every day:  finding a good job that will help you to qualify for the investments that will enable the long term investment plan.  

This is if (1) the financing is conventional (2) the borrower has good credit (3) the debt coverage ratio is at least 1.2 Utilizing private financing, the borrower may be able to come to the table with as little as 10% if (1) he has experience, knowledge, and a good reputation (2) the property net income is able to service the debt (3) he can convince the seller to carry back a small second lien.There are numerous strategies and techniques out there theoretically enabling the buyer to buy a property with no capital contribution on his part.  

The CAP rate is just a simple ratio to ideally enable a buyer to compare the cost of similar cash flows within a specific local area.  

@Brandon Turner, I thought it might be a good idea to formally introduce myself.Originally born and raised in Israel, I've been living in LA since 2003.I'm a Musician by trade and an entrepreneur at heart. 

It enables him to keep living there for free.

I am going to be really fast about this and I want to believe you done or have an independent party perform due diligence on the property to give you an unbias opinion about the property to enable you make an informed investment decisions, this step is very essential to real estate investing success.