Now let's say one or both people making the purchase owned a condo previously where they roll over the proceeds/equity into the new purchase and put 40% down.

If you’re looking for a solid alternative, you should check out Equity Trust. 

Explore the possibility of doing liability insurance instead, if you don't have much equity it may be your best, and much cheaper option.  

In general though, I would think that if this is a partnership LLC you could make a capital contribution in return for equity in the LLC. 

Leverage your existing equity to invest in smaller properties, such as a mixed-use or retail space, to gain experience and cash flow.

If you have any equity in the place, then try and sell it. 

My colleagues may choose a different position.

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.

., the appraisal for 5+ is at least $2k-$3k) and the financing structure by lenders because Fannie/Freddie don't generally buy loans for commercial properties.So, for you personally, the biggest driver for the type of your next property is probably going to be the amount of a down payment/equity you can put in the property.

This reduces your housing payment and helps you build equity.