I'm happy to answer any additional questions as best as I can. 

Most lenders who order appraisals are required to order them through a 3rd party AMC, which can add additional costs to the appraisal but ensures that there is no lender (Or borrower) bias in regards to the values.

Avoid basing it on uncontrollable factors like taxes or insurance.

But that is calculated after expenses and depreciation is factored in. 

@Robert Quiroz I think all of the factors you have listed might contribute.So I’m not going to comment on that but I am going to comment on an assumption you made.If 85% of rents are below market on deals you underwrite then those contract rents are probably THE market rent.You can’t just go based upon area median income to rent ratio.First off urban areas are oftentimes street by street, block by block.

Further, he can extend his “grace” period a further 30 days by paying us an additional $50k.So far, we’ve collected two $50,000 payments in the last i0 days plus the $36,000, or $136,000.

Property Valuation:Investors look at a variety of factors to determine a property’s value, including comparable sales (comps), rental income potential, and location.

I think another factor here in determining whether its a good investment is your age and your goals. 

Location and amenities are the two most important factors that bring potential renters to an STR. 

What factors should I consider when making this decision?