The key to avoiding the situation you are talking about, and rightfully so because it can be a dangerous situation is to buy properties that can sustain their income, in markets that support that sustainability.

A market is considered overvalued when home prices are at least 10 percent higher than the long-term, sustainable level.

So if your end product is 40k  lets break it down.. not a sales pitch or what you want to hear.your turn key company or provider is going to want to make at least 10k.. that's common in the industry.. that leaves 30k to do all this... your contractor putting it all together wants to make 3 to 5k.. so that leaves say 25k to put it all together.to have a sustainable rental.. you need New mechanicals new roof.. sewer scoped and replaced if needed up graded plumbing and electrical.. new paint and flooring.. cabinets and appliances and hot water heater.. this all cost at least 15 to 20k.. leaving you to pay 5k for the asset...

Hey BP,My goal is to hear some advice and/or pointers on what has worked for people with experience in what their advice is.Background:I'm a Carpenter in Northern California working for a General Contractor totaling 40Hrs-60hrs a week My current work is mainly Tenant Improvements/Remodels, In the past I've done custom homes as well.I'm sole provider at the moment for my family and am saving what I can though it probably wont be significant for InvestingIssues (oppurtunities):Dont have much capital 5000-10,000 - Saving about 500 a month Dont have GC license yet - Will have GC license in November 2017Will have Construction Project Management Cert early 2018 (March)I'm looking to be proactive and find an oppurtunity to enter real estate investing with a sustainable stratgegy.Current thoughts:- I can work full time and get jobs on the side to add to capital power - wholesale remotly, with savings?

Buyers eventually learn who buys a property and Sellers won't trust they are getting the best deal if you conveniently are highest bid.Just being direct: It's not ethical, sustainable, or in best representation of your seller.

@Ethan Morgan Good way to have another possible income stream, just weigh the consideration of sustaining it and how much value you can truly get out of it.

LOAN-no sustained income no loan.

I'm looking for a cheaper and more sustainable option than renting and figured house hacking (buying a duplex) while rehabbing, then renting the other unit, and refinancing would be my best bet.  

There are a lot of different reasons why it may not be possible.Must be owner occupiedOn properties over 2 units, FHA has a self sustainability requirement. 

However, my initial capital raise was only $187,500 and the overages of approximately $170,000 have been put on personal credit cards and I need to find a way to refinance those at something more sustainable.