But I would be taking a huge tax benefit up front and making these properties much more attractive from an ROI perspective when modeling for that expected benefit. 

You can find some deals on the market, but they are definitely the lowest hanging fruit and always attract a lot of attention.

It also depends on the type of properties (some less expensive ones attract more problematic tenants) and the local laws around rentals.

Below is a diagram illustrating the three main tenant segments in Las Vegas.If you unknowingly purchased a property that attracts the Transient tenant segment, turning a profit will be nearly impossible due to high vacancy costs.

The really attractive part of the loan is the idea of not having to put down cash as a downpayment (even though I do have cash available since I was initially anticipating going with a Conventional 30-year loan).Is it fine to assume the risk of interest rates going up for the sake of putting 0% down?

I was recently tasked with finding an unheard-of market that could potentially attract brand-new STR investors.

If you don’t have the money to buy your own deal, then I see how arbitrage could be an attractive option.

Buying a random cornfield somewhere really isn't likely to attract a data center buyer not any related interest.

One of the biggest issues with 5% down loans is they are so attractive and change the value proposition for the building. 

The rentals occupied by illegal immigrants are located in areas where the working class, not vacationers, needs housing.