I could see this working if you tried it this way:-buy a very distressed property that somehow still qualifies as "livable"-perform a live-in-flip style operation, minus the flip at the end-do a cash out refi based on the higher value after renovationYou'll have to make sure your cost of renovations are much lower than the equity built.

That's strictly a cashflow mentality since he seldom assumed appreciation.Colorado is experiencing major appreciation, so you could lower your payback standards since your profits would come from appreciation.Finishing the basement: Assuming $15,000 to get an extra $250/month, that's a payback of 60 months or 5 years.

I ran into this problem once where the contract is $50K below appraisal, and they'll only consider the contract value.The way it turned out, I got a lot less from the bank than expected, but in the long run, it did me some good as my cash flow was better because of the lower mortgage.

Everyone says they want lower prices and will just wait but its never that easy. 

If you are not looking for low down payments, the benefits to house hacking are still lower down (20% for owner occupants to avoid PMI vs 25% required by many lenders).

Owner occupied financing is going to come with more attractive rates and lower down payment requirements.

Any lower can be suspect, much higher indicates opportunity to improve NOI via value add.

I have excellent local contractors to do the work as well, and estimated repairs are around 15-20k keeping it on the lower to medium end.

IE If they wanted to invest $10k, I might agree to pay them 8-10% once annually, or something a bit lower semi-annually, etc.

Market starts to swing downwards (lowering price) 3.