We're willing to live almost anywhere in the greater Sacramento area based on what we can afford, provided of course that the property is in a decent neighborhood that has a good chance of attracting responsible tenants.As for budget, I believe we could get a conventional loan for properties up to $600k, but my strong preference is to find a distressed property (or seller!)

I found a property in my area that would produce decent cash flow and appreciation; however, I would have to use funds from a HELOC on a different rental property for the down payment.

that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

I use standard market PM rates in my underwriting, but I also would not work for those rates but it is fair compensation for the work.I typically use vacancy of 5% not because I have ever had a unit that had that high vacancy but I do not have a no payment category and I want the underwriting to be conservativeon the opposite, your rate is a bit high and your appreciation rate and rent growth are modest.overall, seems like a decent attempt at an analysis.  

Still decently affordable. 

He is making decent $, has a good 2.5 years of solid rental history.

Most military are in somewhat decent communities so I cannot see to many reasons not to.

Must have a decent backyard and/or rooftop terrace.* Property in a flexible market to switch the rental from an STR to LTR (if STR doesn’t work out).Questions:* What are the prospective neighborhoods or areas within and around Houston for STR investments?

Findlay is a real oppotunity beause you’ve got a combination of stable job sources, a decent population size, and often lower acquisition costs compared to bigger metros.About choosing an agent..

And someone jumping into this as a complete newbie can expect that they have a decent chance of making some expensive newbie mistakes.