I get it for new builds but existing homes in the 250 range are certainly affordable .. vis a vi west cost prices or other high cost markets like Charleston SC  WA DC NYC  and many others here in Oregon thats the rally cry right now from our governor who just butchered the chips act money and did not get a facility even though its one of the top 3 locations in the entire world to build chips given access to Power ( Hydro and cheap) water ( unlimited Columbia river) and work force ( Silicon forest). 

You'd be channeling the logic of the old temporary and now superseded regulation §1.469-1T(e)(3)(vi), Example 4.

Specifically, under a properly structured Trust the following limitations will apply during the period that the property is held by the Trust: (i) the Trust cannot raise new capital; (ii) other than in the case of a tenant bankruptcy or insolvency, the Trust cannot renegotiate or modify an existing loan nor can the Trust refinance or enter into a new loan during the period that the property is held by the Trust; (iii) the Trust cannot renegotiate or modify its existing leases or enter into new leases other than in the case of a tenant bankruptcy or insolvency (in the case of a Trust that adopted a master lease structure, this limitation applies to the master lease and not the underlying third-party leases); (iv) the Trust cannot reinvest the proceeds from the sale of the property; (v) the Trust cannot modify or improve the property other than undertaking normal maintenance or minor non-structural repairs; (vi) the Trust cannot hold its reserves other than in cash or short-term obligations; and (viii) the Trust must distribute all of its cash, other than cash held for normal reserves, on a current basis.

In addition to taking 6-9 months to close, they are also subject to (i) annual audits, (ii) annual REAC property inspections, (iii) recurring annual MIP payments on top of your interest rate, (iv) large initial deposits to the replacement reserve, (v) commercial space limitations to 15-20% EGI / 25% NRA, and (vi) less forgiving underwriting with 7.00% minimum vacancy rates when determining our underwritten NOI.

having been around a few of these bad actors in my business life over the decades, it unfolds very slowly as your seeing vis a vi criminal indictments..

So one needs to remember what you did in the past may not be quite as lucrative in the future vis a vi cash flow buy and hold...

Its somewhat like a RE license vis a vi a RE broker licenseyou need to start as an MLO  ( mortgage loan officers)  Before you can became a Mortgage Banker  as stated above you need to show experience. 

@Josh V. 

For Texas (region VI) it was 12% in 2009.

@Jen V., I would start looking at other neighborhoods, as the ones you mentioned are likely already overrun by investors.