Lots of interesting feedback - but even if I didn’t feel the OPs offer to passive investors was great - I wouldn’t think it EVIL - which seems to be the opinion of some responders……Key point for people evaluating the “fairness” and “competitiveness’ of the offering is that the sponsor is receiving too much benefit for too little contribution.  

A successful rental property should offer positive cash flow, meaning your rental income should exceed your monthly expenses (mortgage, taxes, insurance, maintenance, etc.).To find the right tenants, ensure the property is priced competitively within the local rental market.

After House Hacking, or if you can’t find a way to House Hack, you should invest where you feel you have a competitive advantage.

I am in a very competitive market here in the Tampa Florida area (Clearwater, Saint Petersburg and beach areas). 

But the diversification may be through a number locations of the same type property, as expertise in one area trumps diversifying into areas where you lack a competitive advantage.  

Mine is a 2022 build  Hey Ryan, Your property checks alot of boxes for me for a MTR focused on attracting families as a whole home rental.Single story, Good school district, Little to no competition on Airbnb, No HOA.I bought a property once in 2015 and it barely cash flowed as a LTR but now 10 years later, I cash flow as a LTR about $600 per month. 

. - Expect buyer competition.

Even though your market might prove expensive, I would exhaust all options before ruling it out.Truth is, you have a unique competitive advantage in your market.  

Negotiations focused on securing the property at a favorable price, enabling us to achieve a profitable margin in a highly competitive market without requiring additional renovations.

SF is too globally recognized and loved to go away in my opinion.