A few other thoughts, if you want to get down to the nitty gritty about the bottom line, though some of these stats are relevant whether you sell or keep the prop: -expected appreciation over life of investment -equity bought through mortgage payments -benefit of the interest home mortgage interest deduction in terms of saved (or shielded) current annual income -a 10% misc operating expenses bill tacked on -a 4%-12% vacancy rate average depending on local norms -25% recapture of depreciation -cost of improvements that will likely become necessary if you keep the house for 10 years+ like new roof, new water heater, new carpet/floors, etc...minus the depreciation you can claim for each over time -whether you've held the property for at least a year, which will impact the classification of short-term cap gains taxed at personal income rate, or long-term cap gains currently taxed at 15%.

Moreover this is a condo in a prime location and I would expect the rental costs to be quite high.

The builder's might be a better short play though, if rates jump up as expected, they are going to be hurting for awhile as they adjust to the lower market demand.

I also have enough cash left to possibly be able to purchase another low end property - a trailer on 2 lots in an area that I expect to join the "boom" within 5 years - without getting too creative with the financing.

If you decide to sell before that "critical mass" where there are more buyers than new homes, expect lower rents or buyers to expect to pay a lesser price.

You could probably expect about 2% of the option purchase price as the option premium downpayment.

I was expecting more.

I wont say deals like that arent out there but I would expect it to be some smaller numbers.

I will add that you always MUST have a contract with your contractors that clearly explains what will be done and all expectation on how it will be done and in what timeframe.

His investment in my venture is the lease discount (I’m expecting to lease at $19 – $22 per square foot) and a business network with money contacts to invest in my firm.