Builder margins are usually about 25% gross, not 100%.

You will be dealing with your employees who are managing other employees.  

Seller grants Buyer and Buyer’s inspectors, employees and agents reasonable access to conduct walkthroughs of the Property for the purpose of conducting any inspections of the Property Buyer may require. 

It was a former employee who was taking them to court over not getting promoted and he threw my name on the suit (along with 3 other sales guys who had better sales numbers).

I cant come up with a scenario that would result in a lawsuit for a single member LLC with no employees where the liability is limited to the assets of the LLC.

But I lucked out and ended up with someone who was a former employee in the NYC dept. of finance!

Hardwood Floors Throughout, Great Live In and/or Investment Property 11 Bedrooms3 full BathroomsFinances:$599,000 (purchase price of House)20% (Down payment to purchase house)$12,000 (Closing cost)$599,000 X 20%= $119,900 (Total down payment)$119,000 + $12,000= $131,900 (Total out of pocket including closing cost)Monthly Income:11 Bedrooms rented for $1,500 per bedroom11 X $1,500= $16,500 (Gross monthly income)11 X $700** (per bedroom property management and utilities) = $7,700 (total amount to manage the apartment building and place tenants in each bedroom, with utilities per month)$16,500 - $7,700= $8,800 (scheduled rental income after property management)Monthly Expenses:$2,200 (monthly mortgage payment, 3.48% 30 year fixed)$2,000 (contingencies monthly expenses)$450 (property taxes)$150 (homeowners insurance)$4,800 (Total monthly expenses)Monthly cash flow:$8,800 (scheduled rental income after property management)$4,800 (Total monthly expenses)$4,000 (Scheduled net rental income) or $48,000 (Annual net cash flow) or 36.5% ROI** $700 out of the $1,500 per bedroom will be paid to a property management company that will assign the tenants into the apartment, but will handle all the maintenance and day to day activities.

LLC 1 would buy/sell houses.LLC2 would run payroll, have employees and charge LLC 1 an hourly rate for worked performed. 

I'm pretty happy with that - it hasn't been perfect, but it's a high risk investment area, and I'm sure they have to deal with high employee turnover and low skill workforce, which adds to frustration that we feel about things not getting fixed quickly, or unexplained charges, etc.For me, as long as I'm making around that 15% mark, I'm fine - I'm banking on the longer term appreciation anyway.

Also, treat your tenants like employees.