Buying 25% below FMV is tough in a market that has 5 times more demand than supply.

The current owner has worked in the business since 1981, and owned it since 2007.Key features:- $25k minimum investment- 4 year timeline, projected annual IRR 35% and equity multiple 3.12- adjacent to public transport, in a suburb where there is both housing demand and limited supply.- operator has built and filled a similar development nearby- You can find pictures and numbers on some of the buildings they have built and are building here (https://lnkd.in/gfbdvtnf).- You can find a profit calculator spreadsheet here (https://lnkd.in/g-2m_vZA).

Partially because you did not rent it for an entire year but mostly because of upfront expenses: getting it ready for rent, buying furniture, electronics, and other furnishings, stocking up on initial supplies, and so on.

We (I work at Azibo, just a disclaimer) have quite robust accounting capabilities and time saving features like Schedule E generation and automated  transaction tagging rules.

But ultimately, there's one thing that rates can't fix - supply and demand.There simply aren't enough houses for the number of buyers that want them. 

In others experience is this return worth the risk given Multi-family environment ie supply, interest rates, project specific risks, illiquidity risk, and more specifically the Preferred Equity subordinated tranche risk (this sounds like just a Mezzanine loan without recourse).

When the area eventually becomes saturated or supply exceeds demand, all you can do is race to the bottom to compete on price.

You could start by giving them a month's supply of one of those brands and tell them they have to flush more often (twice per use).

New supply and rising expenses are probably even more impactful.Florida has some of the most new construction going on in the country, and is seeing rapid increases in insurance costs.

On the other hand, if you find a supply vs demand imbalance in a cheaper market, prices and rents can rise unhindered.