Then you could buy now before competition becomes crazy again and refinance when rates come down.3.

Bad publicity and ratings will cost them a lot more than a plumbing repair

May plan is to pay cash and wait until interest rate improves, then refinance and pull out $150k for a down payment on a second property. 

The prime rate now is at 8 ½%.

 @Doug Smith and @Jay Hinrichs in Colorado the schooling and testing has a much higher bar.

While evaluating potential investment properties these past few weeks, I have realized that the average rent in Austin is comparatively lower and due to high interest rates and property tax, the outcome is mostly negative cash flow. 

If your friend just wants to be the bank and park his money for a guaranteed rate of return then I think 10% is fair and pay it like a dividend. 

In addition, the master-planned community (The Tapestry) will bring more reason for families to move in since there will be multiple schools as well. 

It's hard enough borrow at regular mortgage rates and generate cash flow. 

I'm assuming that with your hard money interest rate will make that a pretty high monthly bill.