My default position has always been, "No one will take better care of your property than you".However, here's a list of issues that can force you into using a PM:Out of State - non local propertiesRE inventory that requires too much of your personal timeSpecific properties with a unit count that then require onsite managerIn Calif, (3) the count is 16 or more units, and if you hire a manager, then you have to follow all the employer regulations, which easily adds 35% above the salary. 

I assume she typically charges 5% to sell.I wonder if its ok to ask her to count the buy side 3%towards her sell side commission.

This act of appreciation will set you apart from others and pay more dividends than you will be able to count.

What I mean is if I get the seller to take an unsecured note (with a better interest rate to compensate him on additional risk), will that debt be counted as part of the "loan" in an LTV assessment if I try to get the property refinanced in a year (essentially will that note amount become instant equity for me which I can play with?).

The qualifying applicants can be counted on one hand.

My mortgage broker says that 6 months is a good amount of time after purchase.... that way it is more believable that you have affected improvements... but in the end, proving that you've done the improvements is what counts... even if it's less than 6 months.  

And I'm assuming banks will only count the one side as income since I'm living in the other?

Ask them to walk you through how income from rental units will be counted and impact your max loan amount.

After setting aside $100 for vacancy and $100 for repairs, my monthly cash out would be $802, not counting the down payment.On paper, it looks like a pretty good deal, with an approximate $400 per month positive cash flow. 

Sounds like something I would be interested in, you can count me in!