The threshold for STR with FDOR (known by most as the sales and use tax enforcers) is 6 months so I keep a clause in my leases that if they move out before occupying the property for at least six months they're also on the hook for paying sales tax on their rent (6.5%  in Orange Co. but varies from 6% to 7% depending on local voters funding their favorite projects with the amount in excess of 6%). 

The existing quad is listed for sale at $1.1M and a 5.3% CAP.Commercial multifamily in the area sells at a CAP rate of roughly 4.5%.The existing property is zoned to allow for 6 units and has available land to build an addition duplex for ~$150 per sqft.Assume 1000 sqft duplex at $150,000 and we’ll build that into the loan.After expenses, the additional units will each increase the annual NOI by $14,400 = (Gross rent – operating expenses = $600x12x2).Purchase Price  $1.1MMConstruction:  $150KLoan amount: $1MMTotal for project:  $1.25MM20% down: $250KPre-construction NOI:   $58,300Post construction NOI:  $72,700What is the estimated property value after construction?

I brought my home for 299k and its went up 6% in a year, projected to reach 346k because of the growth in the area.

You may be able to write a project requirement that the GC carry builder's risk but you'll get some pushback on this.

@Weina Shi sounds like a good project.

Just from renting rooms in your basement, why is it so hard to find someone to fund the project, with those income numbers....

Hello, I am a licensed commercial and residential general contractor who has been building and developing multifamily projects for nearly 30 years in Phoenix Arizona.

Currently I self manage all units as well as the construction projects and I am looking to do this for the next couple years while I slowly turn this task over to my real estate team.

What are your recommendations for a General Contractor in the Wilmington area for a rehab project?  

Check with an independent ERISA tax attorney before you start on this project, and do not simply take the word of the internet or a plan provider that a 75-25 JV deal is OK.