Maybe my comparison of rentals I have there with rentals elsewhere in TX is not fair.

A better comparison would be between two general contractor's estimates, with a well articulated idea of what your finishes are (carpet vs. hardwood).Bottom line is there is a lot that goes into these estimates, and the more you get, the better you are.

Not saying, the market will crash (it can though) but it could very easily stop to grow anymore and then you are looking at a whole different comparison which could look something like this (assuming appreciation is pretty much the same in both markets)Midwest strategyInvest 30k in the Midwest.

His "method" is to sell the package as a business and go off of the "Income approach" as opposed to the "Sales comparison approach" on the appraisals, and the "income approach" is definitely higher.Is that even possible?

It will make clear $500 cash flow on a SFR pales in comparison.  

@Neil Furry your best and most logical step to get into development is to get a handle on how the numbers and the sequencing of the process works.Feel free to message me and I’ll be happy to get you started in these regards.

@Jodi Rhoades Yet - what may be of further help to you - would be to know what some average CAP rates are in other areas so you have comparison.

So while cash flow is different for every property, you would want to find a region/area where housing prices are relatively low in comparison to rents.

I did a mathmatical comparison between Texas and Cali with respect to property taxes only.

Everything else by comparison is completely inferior.So what many people do, they cozy up to an investor friendly real estate agent.