Would love to hear if anyone thinks these numbers / assumptions are wildly off or too conservative.Acquisition CostPurchase Price = $200,000Closing Costs (at 2%) = $4,000Due Diligence (at 1%) = $1,500Up-front Renovation Reserve = $5,000Total Acquisition Cost = $210,500Financing:20% down payment = $40,00080% loan (likely a major lender, traditional 30 year loan) = $160,00030 year term @ 3.2% (educated guess with very solid credit)Monthly Expenses:Mortgage Payment = $691.95Property Taxes = $120Insurance = $55Property Manager (soup-to-nuts) = $159Other Variable Monthly Expenses = $40Capital reserve monthly deduction = $37/month (5% of net income withheld for capex)Assumptions:3 months to renovate / update post acquisitionProperty rents for $1,400 / month (and assuming a 3% annual increase)20 day vacancy assumption = 5.48% vacancy rateTenant takes occupancy month 3Annual expense growth rate of 3%Expected / Target Returns:Monthly IRR (w/ financing) = 15.48%Monthly cash-on-cash return (average over 5 years) = 2.79%Monthly Net Operating Income (year 1) = $798Capitalization Rate = 4.79%Kyle

Sounds like you are already building so you are probably using a construction loan and will transition into a traditional mortgage.

The other option that I know you are familiar with would be to just turn it into a medium term rental which isn’t as lucrative, but still outperforms traditional long term rentals.

Traditional Investment Mortgage

Many traditional mortgage guys aren’t big fans of this loan, as they see it as a danger to their residual business.

Unless you or your spouse is a real estate professional, and assuming this is a traditional long-term rental, the activity will be passive and losses will generally be suspended or carried forward. 

Remember that the properties you are looking to wholesale (distressed) shouldn't qualify for a traditional mortgage loan.

"Only rich people can do that." 7.

Hard money or non traditional lenders like Finance of America (good rates and programs, but service level sucks).

When it comes to accessing loans, a traditional lender will typically need to run the Debt-to-Income Ratio along with Credit Score to qualify you for a loan.