As mentioned in other comments, there are nuances when it comes to a portfolio loan - sometimes lenders mitigate the LTV slightly (75% LTV for a purchase rather than 80%).

Collaborating with professionals who specialize in tiny home development and navigating local regulations can significantly mitigate potential hurdles.

When I started my career in 2007 (pre-financial crisis), the team I was on was targeting advisory groups that work with many family offices, all of whom were seeking real estate investment across asset classes.The biggest reason I think prices are so high and will remain high is because there is an overall housing shortage, there is limited land in areas people want to live in, there is zoning that mitigates the ability to add new supply in any meaningful way, and ultimately, it is the rise of forums like these, Instagram, all the gurus that have platforms now to sell their course to teach others how to make money in real estate.  

Although IRR can be used to compare investment choices as stated above, you as the developer must make an assessment of risk and any associated mitigations to risk in order to effectively compare potential investments.Equity MultipleFirst, the textbook definition: A ratio dividing the total net profit plus the maximum amount of equity invested by the maximum amount of equity invested.

But you can mitigate that buy doing deep dive into the title yourself..  

I prefer buying in vacation rental communities to mitigate risk of STR regulation hassle.

Instead of letting the bad apples ruin the opportunity, learn how to mitigate the risk and protect yourself while expanding your pool of available applicants.Or you can be a carmudgeon like @Thomas S. and lose the opportunity at additional income. ;)What I do:1.

Yes, there are things you have to do to mitigate your risk but that justifies the discount you're getting.Once you decide you're going to do this:1.

To improve my return I have been thinking of including the amount or part of it in the loan if possible.What is the best way to do it in mitigating the risk of killing the deal?

Quote from @Jaganath Dabbi: First, talk to your insurance provider and see if they have any restrictions.Second, figure out how to mitigate risk.