I'm assuming they have very slim margins and thats why they do that.  

I think you might find landlords willing to pay 18% to 20% if you could save them say 5% on all repairs (should be easy with your gross discounts) and guarantee 98% economic occupancy.  

Hi Tom.. search BP forum and you'll find in depth answers, but on avg it is (assuming up to 1500 sq ft)$35/ft (DIY and buying materials on discount)$50/ft (hiring out most stuff, medium grade finish)$75/ft (high end finishes; hiring all work out)Exterior.. if brick.. powerwash and repoint.. look around online/in neighborhoods (esp when it warms up)..

What I mean is I try to buy distressed properties at a discount that need Rehabbing to force appreciation.  

If your numbers are so tight that there is not enough margin to absorb $100-$400/yr in additional expenses it's probably not worth getting into in the first place.

And, some may also argue that getting SFRs at a steep discount is much more readily do-able than finding commercial buildings at a similar discounted percentage.They may also argue that: it's totally worth the trouble getting there by SFRs instead.So yes: it's personal preference.

My why's are my own cash flow analysis and my own break-even point for a 15% CoCROI with a 5% downpayment and some safety margins.

The most I can say on this deal is that I think there is a margin of safety in the purchase given the numbers presented.

I would love to sell properties at an extreme discount to rehabbers.

To me this would point towards them having just moved into a new home, which means they are unlikely to sell at a discount.