You are right about high risk of default.

For on the ground evaluations, I rely on local contacts: agents, contractors, or even property inspectors to provide walkthrough videos and detailed feedback.

I recently watched a video of a social media guru suggesting in 30 days he could have a team in place in any market in the country and be up and running with a successful real estate business.

Would love cash flow, of course, but if I could at least break even on a highly appreciating property, I'd be happy with that. 

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.

Example - borrower uses loan to purchase a home in a B or C grade neighborhood for 380k, spends 50k rehabbing primary home, uses 200k to put an ADU in the back, appraisal comes back at 925k. 

I recently saw a YT video on SDIRA wealth with Morris invest and called them.

That said, American Standard makes a good builder grade one that’s half the price.

Hey @Chi Lo - I actually have a video on my YouTube page about this (lookup ClosedByMo on YouTube).Regarding walls being damp and waterproofed, it means there needs to be waterproofing on the basement retainer walls (this is something you can do post-construction and the contractors would need to dig around the house exposing the basement/foundation to apply the waterproofing). 

There are plenty of video reviews and Bigger Pockets comments on his website if you scroll to the bottom.