That's a big red flag that the value is not there.

Income / expenses are per property, and in a rental business you're going to have to show a gain within 4-5 years or you're going to throw up some red flags with the IRS.

(RED FLAG)

This will be my largest building and I could really use any input not just on paperwork, but what are some deal killers/red flags for you.

Even right now, policy changes in HUD via their Strategic Plan recognize your point:[i]Mission and Vision Statements: HUD’s Commitment to AmericaOur new mission statement returns us to the Housing Act of 1949 and the directive to create “a decent home and suitable living environment for every American family.” ...

If you run into a PM who is not willing to sign off on your request this should raise a red flag especially if your request are within good logic and reasoning.

I'm an American living in Japan.

I have also heard that a D/E exceeding 3.5ish is a red flag.

So jason does point out that your "red flags" should go up when a wholesale deal comes from a rehabber.

In house national advertising through billboards (in most markets), TV (my son saw is on American Pickers the other night), Internet SEO, and a significant direct mail program that does target actual motivated off market sellers.2.