Commercial Revenue Generating properties like office buildings, apartment buildings, retail centers, etc (banks call it "CRE" lending) are typically evaluated from their net operating income, not gross.

We also do a property orientation and show them how to operate the house, change filters and batteries, turn off water main - and of course the mystery of GFCI outlets

The fact I can go to my kid's golf game today, yet still catch a vendor overcharging me $81 the day before on a SFR in Georgia makes me feel the systems that are in place, plus the ability to manage sacrifices has paid off.I've had the same team in most of businesses for almost 8 years, and have a growing RE team that continue to impress me. 

I think some min level of regulation benefits everyone, including wholesalers who currently operate in no man's land. 

Its being operated at STR from last 30 months with great cash flow.

Does the operational company already exist and have income history?

I see a conflict of interest in your role as fund manager and principal in the “operating” company.

For us STR hosts, I know we are very conscientious about guest experience and I want to be proactive about doing things to ensure my business operates successfully.Thanks!

However, they approach financial health from different angles.The 50% Rule is a quick estimate that suggests operating expenses (excluding mortgage principal and interest) will roughly equal 50% of the property's gross income.The DSCR is a more precise calculation (Net Operating Income / Total Debt Service) that determines if a property generates enough income to cover its debt obligations.Deal example:- Class C middle class neighborhood- 4bd / 2ba single family house- ARV: 190k- Purchase: 105k- Rehab: 35k- Market rent: $1,400-1,525- Section 8: $1,475- Property manager: 10%- Taxes: 125 month- Insurance $1250 yr- HOA: $55 month- purchased and rehabbed with all cash.

Insurance typically covers only the directly damaged area, not undamaged flooring, even if it's continuous.