The profitability of the home would not matter, the tax deduction would more than make up for it.  

Profit, 1031 exchange into a larger deal.The reason for this price is I am shopping on what I can put down for a down-payment WITH a partner. 

I think the reason a lot of investors go high end in single family homes could be because you only have one unit, so the profit margins are squeezed, in order to turn a nice profit, you must command higher rents.

And in a 1031 exchange Boot is considered all profit first. 

I should also note that I do have my real estate license, but I honestly don't have the time to use it, but man, I would save a lot of money if I did :D Target Profit Margin $18,000Actual Profit Margin $17,500Financing used: 80% of home and renovations covered by bank with an interest only construction loan.

. % does not work.in our production stuff like we do in Oregon  were the end product is now in the 450 to 500k range  1/4 to 1/5 is what you need for land cost to keep your margin at 15% of gross or there abouts.. but many builders are only making 5 to 10% of gross if that , depending on where they get their construction money.our Gresham project Lennar offered me 130k per finished lot  and we are selling houses right at 450k.. so they were paying top dollar but they build 400 plus houses a year in this market so their margins are much tighter and they are not carrying ANY dirt or land.. they only buy when they can go vertical GENERALLY speaking as I say this they have just gone into contract of a few parcels next to one I am in process of developing 160 lots on.. but basically that's how it works.

HML facilities are pretty cut and dry.but the borrowing against our notes was when I was in the Land and Timber business.. we would log a track  sell it to a home owner on contract but it would take a year or two for them to go through planning get their house designed etc.. and then when construction loan was ready we would get taken out.Generally when we did these the logs paid for the dirt so we owned the property free and clear and would sell the parcels for 150 to 300k ( our profit)  but could not run our machine collecting 2k a month in a payment so we would borrow 50% against them at our bank still positive cash flow and had the money to buy another timber track.. as these were generally all cash purchases..I suppose those that do the brrr with owner financing could run the same model.. ???

Hi @Christopher Oliva,1) I'd be surprised if it's any different in Texas, but in California the rates/profit/etc for all down payment assistance programs are set by the non-profit and lenders brokering them in have zero ability to raise or lower them.

I think the challenge would be to find a deal that would be profitable (esp in the SoCal area) since I would start with a low amount of equity/larger mortgage payments and rents that don't quite cover all of the costs.

I don't want to deter you from your dreams and goals but why don't you invest the money you have in your online company and make that grow and more profitable?