Appreciation will be based on market demand which as we've seen in the last 10 years has gone up and down, however cash flow is a bit more stable and if you're leveraging more critical.We focus mostly on single family homes in class B neighborhoods so I would say you're on the right track.

I don't know your area, but make sure you have comps, understand what the demand in the area is for such space, etc.

Just because they saved up and scheduled that vacation for a year, how dare they say they can't afford to pay you the amount you demand!

Those warmer climate areas due to continued demand have a higher chance of cap rate compressing for equity resale growth in a few years.The areas with low caps already even with quality there isn't much farther the caps can compress.

I nor any of my colleagues will touch Worcester due to the crazy high rate and their outrageous remodeling demands.

Real estate values are based on supply and demand.

Further during a period where supply outstrips demand being the unit that gets further down VRBO's funnel of filters and having more amenities will get you the bookings the others do not. 

I would just say no, counter with the terms you want (maybe even demand they sign a contract you draw up) and see where they go with it.

And the demand has trickled down and pushed our city's prices up as well. 

The reason he won't get a traditional hard money loan is because "his 1st mortgage that he's ad since 1996 is for $141K and at 2.9% and he doesn't want to sign it away to a hard money lender who will demand to be named on the first mortgage"He will give me a 2nd loan on his property in Austin where the LTV is about 61% and pay a few points higher than a traditional hard money loan.