Now, I am also realizing the power of leveraging equity from other assets—like my house hack—and even explored partnerships to spread risk and build a stronger position.

Starting out in a high-cost-of-living area can be challenging, but it also presents unique opportunities if approached strategically.

I am from the Midwest where cap rates are high and you can have positive cash flow with 10-15 year loans.

@James Mc Ree the example I mentioned above was for a 1st position note. 

There are more factors than just pure cashflow and it seems like you are in a good position to be successful.  

There's been a massive revitalization effort that started downtown and has spread throughout the city via the Strategic Neighborhood Fund (SNF). 

My recommendation is to first learn in detail how the foreclosure process works in your state then you may be able to intuit how lenders strategize selling the properties. 

: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.

Great position to be in.

They could positive cashflow and i believe there should be good rental demand from student population but i am not sure about the scope of appreciation in the area.