I have had many clients get burned by not following the chain of command in similar situations.

Putting my commander hat on, make sure you vet your tenants and do not just allow your friends to stay.

Pro - Helpful atmosphere, great training and lots of it, KW Command is still in the works but has become a very solid CRM/website/deal tracking tool, reasonable desk fees, can build "downline" for passive income.

You'll have an additional form of recourse for the occasions when they're not fulfilling their rental agreement (late payments, damages, etc.) by contacting their commander. 

2) Reposition Asset - this is more of a corollary to the first bullet point but if you invest in capital improvements that will allow you to command 25% greater rents, that additional money you invest may be worth it.

Most investors we work with do not target turnkey properties and opt for more distressed homes that will command a good/decent ARV and rent value. 

When demand outstrips supply that drives up prices for RE, but also the rent that those assets can command. 

But because of their current cashflow, I suppose the can command that level of price. 

Knowing I am going to make it up on the back end by rehabbing it to look higher-end to command higher rents.

I agree with everything the contributor before me listed and would like to add that what also matters is the demand and rental price that such a property would command in a construction market.