In the desert it costs me LESS than $20 for water.

I have a follow-up question—what’s your advice on maximizing ARV while keeping rehab costs efficient?

Considering opportunity cost of not affording more rentals vs paying much more in interest.

They will have additional costs for mailing & online campaigns to get leads.

Double the cost of that house and double the rate to 7% and its like $4,000 per month for the EXACT SAME HOME. 

This can put a significant strain on your finances and cash flowThey also often require a large down payment themselves and may have a strict repayment schedule that can be difficult to meet, especially if there are unforeseen circumstances or delays in renting the property or generating income from itIn addition, relying on this type of loan may expose you to higher financial stress and the possibility of default if you are unable to meet your loan obligationsThe final decision depends on your overall financial situation, risk tolerance, and your ability to manage the associated costs and obligations

And maybe diversify a little, invest half in a low cost S&P500 fund like VOO and the split the rest across 2 or 3 syndications.

You could also get a line of credit for about $150k (you should be able to borrow 75% of the value.)The reason I suggest this is…1) you save $40-$60k in selling costs. 2) you have a lower blended interest rate (2/3rds at 3.25% and 1/3rd at 7 or 8% instead of the whole $500k at 7 or 8%) saving you another $1k/mo in interest. 3) you only pay interest on that $150k when you actually use it, not from day 1  Unless you hate this property, or want to buy something you can’t afford without selling, that would be my plan.

Others may argue that higher rates are bad as it drives up their borrowing costs. 

It is fair to express your disappointment that they exceeded the cost target you gave them.