Kelly: @Jim Young @Steve B.

Only bad things will happen if you allow them in your Class A or B rental!

I am at the beginning stages to take my idea of a 506(b) or 506(c) fund and make it a reality. 

@Ying B.

How much would I have to increase my price point to start finding viable properties in B-class neighborhoods?

For my realtor clients I always recommend class A- to B- 4 units, these actually cashflow without being heavily hands on. 

“Insured”: The Insured named in Item 1 of Schedule A and also the parties identified in Condition 2.b.Section 2.b. reads:b.

Even before when rates were low class A/B in desirable areas sold at negative cashflow and the buyers made a killing over time from appreciation and rent growth.

If you're just talking bathroom, I would either a) leave it as is, or b) re-tile everything.

The short version is if you go with the Midwest, figure out which are Class A, B, C and D areas and I recommend picking good neighborhoods (Class A and B) with good schools and go for appreciation.