That being said, I have purchased two previous STRs that started cash flowing in 30 days and they are awesome.

we rarely see advice on this site from investors that talk about going to your city or county meetings when they are discussing the comprehensive plans.. or I have yet to see anyone suggest you go to your city or county and talk to the long range planner.. its not a guess its planned get ahead of the plan to create real estate wealth. buying a rental house is simply RE starter one oh one and investor tend to simply focus on ONE metric cash flow at the purchase which i guess is fine but its a slow boat to be on . .. but there is so much more to real estate that SFR rentals buy and hope   Hope your tenant is good hope your neighborhood does not go to pot etc. etc.  

Solid cash flow, appreciation not to scoff at, and less risk during economic downturns.

However, if the home has little cash flow return would it really be a good idea to share an asset with friends with no short term returns? 

However, the path is fraught with challenges, many of which can be avoided with careful planning and consideration.

Don't just take their word for it, because you want to know that you are buying into a cash flowing asset that will at least come close to projections. 

(I would really like to keep my 40k for the next house purchase) Do I just get a conventional loan for now and then refinance 6 months down the road to get as much equity out as possible without it affecting the cash flow too much?

In the tranquil landscape of Upstate NY, the quiet allure of vacant land listings may sometimes go unnoticed due to apprehensions surrounding profitability and the considerable investment required to prepare the land for development.

Build equity over time while generating consistent rental cash flow.

Rates are about about a point higher than normal DSCR loans (1-4 units), but you can get a rate in the mid 5's (with decent credit) on, like I said, a 30 year amortization (fixed).It will cost a few points (probably 3 depending on the loan size) and the appraisal will be a narrative appraisal, so expensive, but they close and cash flow well with the longer amortization.Find yourself a good commercial broker.Stephanie