Last year set records for transactional velocity.

Fipping depends on velocity to reduce opportunity cost and maximize return.  

It can certainly happen Its a job though in my mind I was going to get into liens in MS  I took a few hundred grand to a sale to try it out.. and left after spending 5k .. the velocity of the sale in that state and the good ole boys and the experts with their lap tops and really new the game ...

then your off and running someone else is paying your mortgageONe very important point to all of this and I think the post  08 GFC creating a huge shift in thought process of what a good investment is and what a bad one is.How many times do we hear folks say... appreciation is icing on the cake blah blah blah. and its all about cash flow.and we forget about the power of your tenant paying your mortgage off and your tax write offs.. those that try to reach for the highest cash flow deals usually end up with the least over time and the worse asset.. those that understand that real estate is location location location and you want your tenants to pay off your house.. there is not enough velocity of positive cash flow to substantially affect someone's life unless they can buy 10 to 50.. what you want is a solid property that your tenant pays off so that in 20 or 30 years you own it free and clear that's when you cash flow and or you have an forced savings.For bay area investors.. how many would have liked to buy in Cupertino or Palo Alto or any other peninsula area when homes were 100k ( 1980 and just let the tenant pay off the mortgage ) even if you had to feed it a little over the years. what would you have in 2010 when your 30 year mortgage was done.. ????? 

Because of this, rental velocity is simply a matter of price.

For budgeting and reserves, I used 10%, and in servicing I was advancing payments then collecting, something much different than the average note investor.Loan diversification is important as well, you can follow bond theories that apply to notes.I'll say too that churning those notes purchased at a discount, refinanced at PAR quickly pushes your yield skyward and the tax issue is more irrelevant IMO, when your yield is 50% annually you can afford the taxes.As Dion suggested, it's a function of yield over time, don't forget time and the velocity of your money. 

It is not that there is going to be an increase in rates, it is the velocity of the increase that is most important.

The theory of the velocity of money applies.

Nothing wrong with flipping but the key is velocity.

The short answer is 20% but that could go up or down depending on the scope of the work involved, and the market velocity of the area.