The 5% is more of an industry rule of thumb, 10% is what I try to do, but I am more conservative and don't take any Distributions or Draws from my Real Estate.

For DSCR, really conservative files will price not far from parity with Conventional with a two year+ prepay in many cases.

The projections should be conservative.  

The tax assessment values the property at $56,000, but, on the contrary, I find tax assessments tend to be conservative.

In addition I have yet to encounter a seller cost of value add being as high as my conservative cost Projection for the value add.

Understand that conventional and govt loans are very conservative when it comes to rental income/investment properties, and lately, even calculating personal income has gotten more conservative.

Banks were very conservative and nationals had not come in to the market yet..

No matter what you don’t ultimately want to pay for a tenants AC or Heat because they have no incentive to conserve it.

Be extremely conservative on ARV in this market Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I just renovated a 2 BR / 2 BA single family built in 1900 and it was 55K.Also, there's no such thing as "ARV 200-300K" - you need to conservatively estimate the ARV and come up with a much narrower range.Finally - are you local?