As is normally the case, the construction period rate is adjustable and tied to the fed rate with a lower rate once the loan resets as a permanent loan.

The idea is that the appreciation will far outstrip the relatively modest cash flows you'd be able to get in lower priced areas. 

., if they're the selling agent or own the construction company, etc.)If all estimates go to plan, then the 55% net profit should provide an 18% annualized ROI for the $1M, but likely lower.

I'll echo that most of these Midwest markets that skew toward lower purchase prices are similar.Areas can be hit-or-miss and you need to really understand the risks and potential rewards before making the plunge.

For the experienced partner, they might not want to occupy themselves, but still want to take advantage of low down payment and lower rates for primary occupancy financing.

It's generally advisable to have a lower ratio for better loan approval chances.Down Payment: Save for a down payment.

@David B.It's interesting to learn about your real estate investment experiences and your intention to concentrate more on Salt Lake City (SLC) local transactions.

If the latter, could you buy a duplex and live in one unit and rent the other while still keeping your housing costs the same or lower than they are now?

At the lower price point, that's where people will compete against each other to drive up rents. 

I think you can afford lower levels of cash flow, if appreciation potential is there.