We are not upset with my stepdad, plus he's now in his mid 80's - we thought it would be wrong to attempt to force him to move this late in his life.  

I totally agree with you on the new restaurant thing and I would not do it at this point in my life.

@Sean Fisher The HUD FHA 223(f) insured mortgage program for apartment and multifamily properties is one of the best financing programs available.

This isn't debt per say but one thing I haven't seen mentioned was insurance.

The numbers look good:Location: Broadway HouseNumber of Units: 1Rent: $1,350.00 Square Feet: 1,666 Upfront Costs:Cost per Unit $95,000.00 Price: $80,000.00 Cost per Square Foot: $57.02 Cap Improvements & Repairs: $15,000.00Cash on Cash Return:19.84%Total: $95,000.00 Debt Coverage: [minimum 1.6] 1.78 20%Down: $19,000.00Capitalization Rate (ROI)9.05%Current Assessed Value: $29,666.00 Loan Amount: $76,000.00 Net Cash Flow per month: $314.08 Interest: 4.88%Net Cash Flow per month per unit: $314.08 Term (yrs): 30Total Rent/Month: $1,350 GROSS SCHEDULED RENTAL INCOME: $16,200.00 Less: Total Annual Debt Service: $(4,826.40)Less: Operating Expenses: $(6,470.63)Less: Vacancy and Credit Losses (7%): $(1,134.00)NET CASH FLOW: 3,769 NET OPERATING INCOME - (NOI): 8,595 INTEREST: 3,680 DEPRECIATION: 3,455 NET INCOME: 1,461 Property Insurance: $1,000.00 Property Management (10%): $1,620.00 Placement Fee(30%): $405.00 Real Estate Taxes (5.06179%) $1,501.63 Repairs and Maintenance (12%) $1,944.00 Services: Snow Removal: 720 Utilities: Electricity: N/A Gas and Oil: N/A Sewer and Water: $30.00/mo Other

I have not seen small condo projects because the construction defects law is not yet fixed so I think you will have a hard time finding insurance to build them.

so 4K (x2), 400 (x4) 1K (x3) = 12K + little things here and there IE 3 flooring redos at 2K a pop, so 18K total over 27 years.That's assuming I hold it for 27 years, at which point now it's free and clear so my cash flow turns into $600 a month.Your property analysis adds $213 for utilities I'm assuming that's HOA/Insurance?

Lot's of renters tend to have rough life experiences so are ultra sensitive to anything that is perceived as taking advantage of them.

after 6% interest on my heloc and the conventional mortgage, realtors, closing costs, insurance and the rehab...

Here are the stats: Construction costs - $50,000 Purchase Price - $225,000 Current Appraisal Value - $375,000 Post Construction AV - $440,000Current Loan Amount - 195,000 Rental Income - $2,800 Mortgage + Taxes + Insurance - $1650 Liquid Cash - $10,000My partners and I want to get the remaining projects off our plate and are trying to figure out the best way to make it happen.