Now of course being a developer I risk the building plans and other cost Usually 5 to 10k per home. but that's just the cost of doing business and we pretty much hit 99% success. but there are instances were we lose money because permits are not going to be issued.. but again just little hiccup and easily eaten.When I am doing my larger developments.. 20 to 50 lots..

I usually send my clients to Agave Properties.

SFRs normally do have higher risk for a capx and/or vacancy event to create 0 or negative returns for the year.

He is a investor obviously so may be open to financing, multi fam owners usually are open to this more then single family owners.

It rents for $900 per month and provides us a 25.63% Cash on Cash Return or 11.16% Cap Rate (usually only used in commercial realm, but we do commercial loans on packages of homes to avoid using our personal credit).

Assuming you're getting funds at the usual 30 yr at roughly 4%, it's hard to find cash flowing in OC.

I usually look for minor value add opportunities, like paint, drywall, and other cosmetic improvements that can quickly make properties much more appealing.Best of luck investing!

One of the things that we do not usually hear are the stories of how a business is built from the ground up.  

Let's rounded to $400/mo/unit to simplify the numbers.That is an income of $1600*12/yr from rent ~= $19,200Now, expenses:Maintenance: $9,600/yr (50% rule)Taxes: Around 1% ( lucky New Mexicans): $1,700/yrMortgage Payment ([email protected]%): $763/mo ~= $9,150/yrInsurance: Around $1,000/yrPossible Cashflow per Year: 19200 - 9600 - 1700 - 9150 - 1000 = (-$2,250)A negative cashflow does not look so good, but here are 2 opportunities to increment it:1) Increase rents.

What does J Martin usually tell you guys?