you performed these regularly, but if you did, it's good that you had a manager to look over your calculations because otherwise you left a lot of money on the table. This is my last thought because my wife's getting irritated that I have spent so much time on here so you guys can have fun at my expense later. What's funny regarding your IRR is that it doesn't even come close to passing the smell test. The payback period is approximately 2.5 years yet you calculate an IRR of 8.5%. I would have laughed you out of the room and told you to get out and do it right.
Here is the calculation
Period 1-there is no capital, however, you want to charge debt as a capital expenditure so -250000
Period 2-rehab costs -40000 initial payment of +7500 and sold for 1000000, since you made me pay it off at the beginning rather than using debt, there is no payment. Since it's not leveraged, the return isn't as good so it is sold for 4* take out your Realtor fees and title and whatever else and it's still around 280%