If your goal is strong, predictable cash flow without the headache of constant oversight, a lot of investors are pivoting to Midwest markets.

The goal is:Very stable, predictable cash flowLow operational stressHigh tenant qualityFlexibility to run LTR as the baseline, with MTR or occasional STR as optional upsideTargeting minimum 6% cash-on-cash unleveredI know this is not the typical BRRRR / high-leverage approach.

So, many things may have changed with regard to the borrower's circumstances and the property that what has actually happened (seasoning) tends to be much more valuable to me than infomation gathered decades ago in an effort to predict what would happen (underwriting). 

Construction cost per sqft in South West Florida varies quite a bit depending on model, size, and utilities available.One thing many people overlook — the larger the house, the lower the price per sqft due to fixed costs being spread over more living area.From what we’re seeing across current spec builds in Southwest Florida:• Large single-family homes: as low as ~$97 / sqft (city water & sewer)• Smaller single-family homes: up to ~$128 / sqft (well and septic)• Duplexes: starting around $113 / sqft (city water & sewer)Utilities play a big role — well/septic, fill, flood zones and elevation can move numbers quickly.We focus mostly on standardized investor product, which helps keep pricing predictable and build times tight.If anyone is underwriting specs or duplex deals in SWFL, happy to share real budgets or feasibility numbers based on current projects.

I heard that 2025 was a terrible year for STR and many predict the same expectation for 2026.What's your advice?

For beginners, comparing rate, points, and speed is usually what guides them to an initial lender, those variables definitely matter.But I also think that when that first deal goes smoothly and the process feels clear and predictable, that’s what really sticks.

Private mortgages are fundamentally a credit investment, so the goal should be steady, predictable returns driven by structure and discipline rather than leverage or financial engineering...by truly experienced people with long-time formal credit backgrounds. 

I'm currently looking into markets that have a set rate/cap to make deals and profits more predictable.

You need someone experienced in:Boarding houses or SRO-style propertiesShared-facility enforcementFrequent turnoverStrong rule enforcementIn this asset class, screening and house rules matter more than rent level.Before hiring, decide what you want this to be:Hospitality (Airbnb-heavy, marketing-driven)Workforce housing (long-term, stable cash flow)Social-program housing (higher oversight, steady occupancy)Trying to do all three at once without systems can create friction.The key isn’t 100% occupancy — it’s predictable occupancy with manageable tenants.

In many cases, a well-managed common laundry area reduces maintenance exposure, creates predictability, and even introduces ancillary income.