Rent Vs. Land contract

[George Mill]

Was having a few drinks with my investor friend and he told me that he has shifted to a different strategy and it has been working out for him, wondering what everyone on here thought ;

Instead of renting his houses, he puts land contracts on them. For example his houses are worth around $80-100k,he sells them for 10% over estimate, he asks for 3-5k down 15 - 20 year terms, 6.5-8.5% interest and includes taxes and insurance in that payment. Usually rents his properties for 850-1000$ now he is getting around 730$ but does not have the hassle of dealing with property management, repairs, taxes and insurance. Has an attorney deal with his legal issues if they should arise. Has been lucky, with no foreclosures yet. Has moved half his property inventory over to this ( around 18 houses) and said after a few years will look to sell the notes of the performing assets.

Not sure if anyone else does this, but seems to be a pretty good idea. Interested to hear others thoughts. Thanks!