We are mainly looking to use the property for cash flow as opposed to appreciation.

Are you referring to someone choosing a class A apt as opposed to rentals we have available?

I don't know what a good vacancy rate is as opposed to a bad one.. but if your managing 2k to 10k houses I suspect your always have some manner of vacancy.. the main take away for me is you simply cannot buy property in the "cash flow markets" were your buying in the lower third of the economics of a given MSA.. those are just tough for whatever reason history has proved this.. most of the buyers have only them selves to blame here.. they are all mesmerized about COC returns and take risk they just don't understand.. then they blame the tenant and the asset.. when in fact its their own choices that lead to the inevitable in low value asset or bottom third in price point in a MSA..

If you were to get sued an opposing lawyer will not be stumped by your LLC. 

You must have basis in your S-Corp equal to at least $0 in order to deduct the losses.So now you have to contribute more money to your S-Corp in order to increase the basis with the opposing entry being a Shareholder Loan. 

The extra cash flow works for our plans now which is why I'm not opposed to it.  

I represent both owners and GCs in TX; I often only see penalty clauses as opposed to incentive clauses.

I prefer to have significant reserves in diversified invest easily accessed as opposed to dead equity I can not control or access during a down turn.

This assumes of course that you want your cash working for you as opposed to simply being debt free.   

Paula,What are the risk in down payments opposed to placing the funds in a trust?