After accounting for ~$3,500 in annual taxes and ~$900 in annual insurance per property, the net would be around $61K per year.While that isn’t flashy, the benefit of new construction is minimal large capital expenditures for the next 8–10 years.

And with this, certain dates will pop out, times when your going to be getting deep into capex expenditures.

Another component is capital expenditures that adjust the basis (book value) of the improvements. 

Have you factored in vacancy, capital expenditures (roof, HVAC, plumbing, etc.), and potential management fees?

These days the time and energy expenditure usually outstrips the effort, meaning that I spend more on the items than they are worth to me or someone else.

It is an investment property.The Seller/landlord is willing to fulfill either contract, but the Optionee gets to decide which contract prevails when a major capital expenditure arises.

You might need to absorb other expenses like vacancy, capital expenditures, and maintenance for a while.

If your explicit approval is required for ALL expenditures over the $300, that is one thing.

Look for areas with steady or increasing household migration to ensure a strong tenant pool.Financials:Rent Roll: Ensure accurate current rents and assess potential for increases to market rates upon turnover.T-12 Statements: Analyze the past 12 months of income and expenses to understand historical performance and identify anomalies.Operating Expenses: Go beyond the T-12 and create a detailed expense budget based on realistic projections and market comps, not just what the seller reports.Property Evaluation:Physical Inspection: Don't skip a detailed inspection to assess condition and identify necessary capital expenditures (CapEx) to avoid unexpected costs post-acquisition.Cap Rate Analysis: Compare the property's cap rate to recently sold similar properties to gauge its value and potential return.Financing: Explore different loan options (conventional, Fannie Mae, etc.) to secure competitive rates and terms, ensuring your debt service coverage ratio (DSCR) is strong.Value-add tip: Consider potential value-add opportunities like unit renovations or amenity upgrades to boost rents and NOI, but only if they align with the local market and target demographics.

Unless the place is trashed, this takes the minimum expenditure to meet local codes.Option #2: Sell on a lease purchase agreement or rent to own.