You didn't write how much 'sweat equity' you put into this place, but it was likely well worth it given the $400K cash out.  

I came up with a goal of having one property by the end of the year that cash flows at least $100 a month after all expenses.

Otherwise, I think it is a good area to buy, it should cash flow as an LTR on day one (unlike other places nearby) and it is a nice community. 

I went from growing up in a hut in Vietnam and spending my early years in Section 8 housing in the U.S. to now owning four cash-flowing properties (8 units) across three states.

I pay all cash double digit cap rates with NNN syndications.

I'd say 1% deals are going to be more of an appreciation play rather than a 2% deal which will undoubtably cash flow. 

When considering single-family homes (SFH) or small multifamily properties, it’s important to analyze rental demand, local property values, and rental rates to ensure you’re getting strong cash flow potential.

Bringing uneven cash flows back to present values to cover debt service and ROI can get to be a complicated issue.

And again, with a separate parcel it should be easier to finance the construction and do a cash out refi. 

There is risk that the parties won't agree to return the cash held in escrow.