Well anyone can write anything into a contract, but whether it is legal and enforceable is for the courts to decide...It is State law here that a contractor must call 811 or they are liable for the costs.

I guess it triggers the "sunken cost fallacy" part of their brain.

However, you make a great point about starting local and dodging PM costs to start...

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

WE are seeing this in the Portland market.Montgomery Park the largest office complex in the state that sold about 7 years ago for 250 mil just got bought ( after no one bid it at foreclosure) for 25 mil by Menashe family. its over 1 million sq ft.. dont think you can lose on something like that. reminds me of the buys in 2010 in some markets were sfr's were selling for 1/4 of replacement costs..

You still have the cost of lease renewals, but that's minimal when compared to the cost of turnover.  

It was the best solution but it did cost extra. 

Risks: rates go down and you have to pay a prepay of 2 or 3 %; you have to sell and pay the prepay; rents decline & you can't make the payment like any other type of loan; cost upfront a little more than conventional; need to find experienced broker licensed in the state where subject property sits; servicers are bulldogs. 

Seller Pre-Sale Financing: Consider selling the tenant-occupied property "as-is" now to an investor, perhaps at a slight discount, which could save time and eliminate renovation costs.

The only approach I’ve found effective is offering a deposit alternative, which lowers upfront costs for tenants without devaluing your property.