That said, the most money to be made in residential rental real estate is in C/D class housing in areas on the verge of becoming "discovered" and the influx of residents and investment money driving up prices (the equity that makes you rich).

That's likely the broker trying to get more money at the end.

It isn't much yearly for a pure investment property.What will it bring in as a LTR?

You can rent out the spare rooms to roommates to build experience and save more money for your next investment.  

My rate would be going from 5.625 to a 5.25 which is okay but I just money out to the deal primarily.

Cash, Hard Money, and Private Money are king!

After I save up some money, I want to start building spec homes in the DFW area.

Hi BP Community,I’m looking to refine my real estate investment strategy and want to make sure I’m on the right track.Here are a few areas I’m focusing on:Property Selection: How do you choose the right type of property for your goals?

It's Indianapolis where I invest.

Then you can read a more in-depth book like The Book On Rental Property Investing by Brandon Turner or The Unofficial Guide to Real Estate Investing by Spencer Strauss.2.