Most lenders will also look at debt coverage ratio which limits leverage at this time due to higher interest rates.

You might want to check out listings in your neighborhood to get an idea of the going rates and what amenities other hosts are offering.

Have a baby, and gallop into the sunset (while still making calls to PM's)INTEREST:I first got interested in Real Estate Investing because of the potential financial freedom it can provide to me and my family.Hi Christian, if you're looking to net cash flow $2500+ from 3-5 single family houses, that's going to be very very hard to find especially when interest rates right now are 7%+ for an investment property - unfortunately, it will be very hard to find that in any market today. 

@Iris Olivas Most local banks/credit unions can do this deal with lower fees and potentially rates than brokers.

Another alternative here could be refinancing although it is likely your rate is well below today's rates.This is not financial advice, I am not a lender... just sharing some insights that have been shared recently. 

Using a CAP rate of 7%, the $16,000 becomes= $228,000 of added value. 

Where these numbers are found, there is a very high rate of rent actually being paid.We have over a dozen Fortune 500 companies just in Metro Detroit with huge Healthcare, Auto, and mortgage industry National footprints.

If the rents are already nearing market rates, will she be able to go up that much? 

Let's break it down with precision:The "Pain" (At First Glance):Your $2.8M sale splits out as:Building (§1250): $2.3MPersonal Property (§1245): $500KOriginal Basis Allocation:Building: $1.6M (depreciated over 27.5 years)Personal Property: $400K (fully depreciated)Building Depreciation:Annual: $1.6M ÷ 27.5 = $58,182Total over 10 years: $581,820Gain Breakdown:Building (§1250):Sale Price: $2,300,000Original Basis: $1,600,000Less Depreciation: ($581,820)Adjusted Basis: $1,018,180Total Gain: $1,281,820Unrecaptured §1250: $581,820 (25% max rate)Capital Gain: $700,000 (20% max rate)Personal Property (§1245):Sale Price: $500,000Adjusted Basis: $0Ordinary Income: $500,000The Strategic Play:Remember those suspended passive losses you couldn't use?

Since fix-and-flip income is classified as active income, taxed at ordinary rates, this setup helps minimize overall tax liability.To protect both members, draft a detailed operating agreement outlining roles, ownership percentages, profit-sharing, and an exit strategy in case the business dissolves.