My past investing has been purely in high risk derivatives for the last 10 years which hasn't panned out well at all.

It becomes much more of a grey area if it is sold explicitly as a turnkey business model, but even then, I would be wary as a buyer to use that value rather than deriving a value from market rates/comps, especially if it is a SFR.

The AML Program should provide clear and unambiguous procedures to identify such instances.A transaction requires reporting if it is conducted or attempted by, at, or through a covered retailer or community, it involves or aggregates funds or other assets of at least $5,000, and the covered entity knows, suspects, or has reason to suspect that the transaction (or a pattern of transactions of which the transaction is a part):Involves funds derived from illegal activity or is intended or conducted in order to hide or disguise funds or assets derived from illegal activity (including, without limitation, the ownership, nature, source, location, or control of such funds or assets) as part of a plan to violate or evade any Federal law or regulation or to avoid any transaction reporting requirement under Federal law or regulation. 

@Kris Haskins and @Jay HinrichsI never heard of that before it's like "owner financing meets derivative contract!"

How did you derive the $66K valuation-- is that a BPO as-is value or a ARV? 

The answer was that they derived all their income from real estate.

The relationship between changes in employment and changes in real estate prices becomes more obvious when we look at percent change in employment, and the rate of change (second derivative, but don't get bogged down in the terminology..)This is interesting because:1) The relationship appears meaningful2) You can see a deceleration in employment gains (lower growth rate) while real estate prices are still increasing (at a decreasing rate).

Personally, citing numbers to a buyer, your current economics is not the issue.You site the Purchase Price, assume an LTV and calc the loan payment for say 20yr, 4.125%.Calc the existing GSI, expenses (with new taxes, insurance) but sans the principle and interese, and derive the NOINow you've got the data for cash/cash and cap rate.These numbers should entice the buyer to be interested BECAUSE there's a cash flow and/or cap rate.

As to option pricing, the value of any option is a derivative of the value of the asset over the term of the option.

However, it does have some elements of Real estate investment trust (REIT) with dividend yields, combined with a truly a unique strategy deriving from my many years of investment experience in star ups in the Silicon Valley and construction experience, including rehabs and new construction.