He knew what pockets of Houston were hot sellers, what pockets had a lot of buildup and better to avoid, which areas had more competition, which areas had more equity, which areas had new home supply scheduled to come in.  

If you have 60 units, you can literally create your own market within your complex, and find your own supply/demand curve.  

Also to your point of the day care and company car, I think that's valid and I would add that it it might also look legally like a home office - she still maintains part of the house for her personal use (to store cleaning supplies and linens)., Interestingly enough my mother's best friend runs a day care out of her personal apartment in NYC.

The few multi's that hit the market sell very quickly and for a premium due to the supply and demand problem of them.

NOI/sales price =Cap rate.The NOI is the NOI no matter what.The only variable is the purchase price.If NOI is $12,000 then at a 19% cap rate the market is only willing to pay $63,158.If NOI is $12,000 then at a 9% cap rate the market is willing to pay $133,333 for the EXACT same possible NOI. 

I seem to learn something new everyday from this sites endless supply of knowledge. 

(spend 4k for the remodel and supply's)  after all the repairs the trailer should rent $400 a month.

Supply in my market is very low.

There is still the issue on cost/benefit and required ongoing costs to buy and supply salt.

Be extra careful with the sizing of the existing plant before you ever consider a conversion like this.Tankless electric heaters need  high current circuits.Tankless gas heaters need larger, higher load gas supply, chimney and venting systems.The project will not be a simple plug and play.