Clear Creek County and Gilpin County have caps and are past those caps, as is Summit County.

., Purchase Price: $475,000 ($197.9/sq. ft.).Estimated Market Value: $402,000 ($168/sq. ft.).Financing Terms: 2% interest rate, with a 9-year balloon.Unit B Income: $2,049/month (Section 8 tenant through November 2025).Unit A Income Potential: Similar rent or higher; Section 8 cap for the area is $3,234/month.Monthly Loan Payment (P+I): $1,386.Cash Flow Breakdown (if both units are rented at $2,049/month):Gross Rent: $4,098/month.Vacancy (10%): $410/month.Operating Expenses (37.3%): $1,376/month.Net Cash Flow: $943/month.Key QuestionsWould you be comfortable paying an 18% premium for financing at 2%, especially in a market where current mortgage rates are closer to 7%?

I ran the numbers and looks like a good deal (7% cap rate, 5% ROI, and ROI will improve as the years go by).

Unfortunately cap ex usually catches up to them and the appraised value rarely translates to a similar sale experience and all along the property has merely been a highly levered property.

In addition, in Florida there is a cap on property tax increases each year of about 3.5% increase... but big caveat...

However I like to run my numbers conservatively and account for cap ex, vacancy, maintenance reserves 10/5-7/5-7% respectively.

The main issue is your exit is capped so if your costs go up, your profit goes down.

This includes cap ex, repairs (will a renter leave the property in the same condition you hand it off in?

Assuming this is an 8 cap neighborhood you'd have a ~$420-450k value within a year (unless property taxes are crazy high) when leases would renew since it'd be valued as a commercial building with the office space.

This is where the voucher cap and specific property limits get looked at.