Being that I get taxed at a higher rate for wage earnings then i do for capital gains I actually take home more for way less work.

In most situations, the more profitable a property is, the higher percentage the GP is paid.

., 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%?

Analyzing an investment with the Cash on Cash return makes more sense to me.I got .93 from the MLS in Tucson in 2024 - but you also need to consider the longer vacancy vs. a higher grade property. 

I suggest 8% for a great credit buyer and higher for one with poorer credit.

Id keep looking if it was not an approved short sale ( even an approved short sale takes a very very long time and theres no guarantee that you will even close on the house after months of waiting). q1)There are plenty of non traditional lenders that could offer you construction financing if the numbers make sense but it will cost you with points and a higher rate.

Increase the occupancy rate to 80% or higher over the next 12 monthsto increase the value.

Index funds beat those returns by a long shot and don't have furnaces to replace or tenants to deal with.As I see it, the only way to actually cash flow in the current market is to do a higher effort strategy (STR, MTR, rent by the room, etc.) or have low to no leverage. 

I would spend a few bucks on nice ads in local magazines and/or do flyers in areas that are higher income. 

Ironically the invested capital is often very similar for either. because your either investing capital in # of locations to scale, or investing capital in higher quality ie higher cost assets and operational items.