Knowing that someone who can afford a $500k house, can often also afford a $600k or even $700k, house, and will want more of everything (better location, bigger house, better finishes, etc).As for number 1, not even just paying it all up front, but working with any contractor that wants "percentage" draws.  1/3 up front, 1/3 half way done, 1/3 at completion.  

But I think the advice I'm hearing from @Julia Lyrberg and @Dave Foster and @trevor finn  is 1) that it might be smarter/lower risk to diversify and 2) that I really might not be able to afford to keep my primary house as a rental.

The COVID bonus pay days are over so what they can afford to pay is really down from the height of the pandemic.

On the one hand, I can see it as a positive indicator, for example of market health and increasing suburbanization. 

(Couldn’t really afford the place, didn’t have good enough credit to be worried about an eviction, etc etc..)2) They should have posted a 5-7-10 (depending on local laws) to “pay or quit” as soon as the ent was late and started eviction.

My tip would be to buy properties in desirable vs "affordable" areas.

Should I assume the in-place IHDA loan at acquisition or close with a conventional loan and try to get IHDA loans/grants/credits later if/when I decide to keep affordable?  

Look into out-of-state markets for better affordability and ROI opportunities.Success requires risk, but calculated risks with proper preparation can lead to life-changing rewards.

Lenders are reaching out to Fannie Mae and Freddie Mac to have the minimum increased, since this is an issue that will not go away as insurance companies raise premiums to stay profitable, and HOAs try to avoid paying higher premiums by increasing the deductibles (or sometimes they need to do both to afford a policy at all). 

And in many cases this may be warranted as health and safety issues may be present.