It is possible to BRRRR this way, but you'll pay more, and you need to be absolutely sure that the ARV justifies a purchase using financing.  

Fees should be clearly stated in writing, easy to understand, and justifiable.

Then at the end of 12 months, you can raise it again if justified, under a new extension. ** Another way to look at splitting up the rent increases 6 months apart is: would you give a prospective new tenant a one-time $300 signing/move-in bonus of some sort, if they agreed to the $100 increased rent rate?

You typically need to justify it as something like an "in law suite"; no using the term investment. 

We've been renting the condo out (for ~$2000 - a little below market value, but not much) and losing money every month since that time - PITI is $1900 but HOA fees are  $450 - it's not a big loss compared to my salary, so I was justifying it based on appreciation.  

Flips at the likely price point in our market usually don't carry a big enough profit margin to justify the risk when there are better options out there.  

Lower expenses and vacancies will justify a higher price.

I am sure that most of it is justified, but they are still a client and until they prove to be a bad client, I can't see treating them poorly.

You don't want to pay more than the local market can justify.

They really don't do much other than the title search (sometimes they add crap just to justify their fees, which makes it worse- I've literally told them they were being silly at a closing table before, which is kinda fun, they really dont know what to do when you call them out on that kinda thing, they're so used to people thinking they are the all knowing OZ because they have a JD), but I pay them anyway because it adds a lot psychologically to the sale for the seller.