I don't think trading financial derivatives is an efficient allocation of investor resources UNLESS that investor is confident in the impending crash, has sold all his/her holdings and is so certain of the timing/severity that they can allocate the time to bet a substantial portion of his/her available capital on it. 

So we opted to do allocated water.

You can use assessor allocation %.

Just a less than 2c comment: Due to Oakland rent control, personally I would allocate some "extra" value to the duplex with 1/1... 1/1 likely more turnover, so easier to attain market rent, affluent renters might be easier to manage and the possibility of living there gives you more options.However, since income is your stated priority - makes decision difficult.

The operating agreement usually includes percentage of interests, allocation of profits and losses, member's rights and responsibilities and other provisions.Obtain Licenses and Permits.

The third one is ok - I don't mind the way they run things and I don't feel the need to be involved.As a CPA, I can look at a set of financial statements and pretty quickly find areas for improvement, calculate a true necessity for a dues increase or a special assessment and do everything possible to keep the community in good shape while allocating funds appropriately.Don't like your HOA?  

In terms of it being affordable from the financing perspective you typically get much more advantageous terms, for example, Multifamily FHA LTV can go up to 87% for Projects with certain number of affordable units (the number of units vary based on the number of units allocated to various Area Median Income thresholds, like 30%, 50%, 60%, etc, you would also typically need a Land Use Agreement to go along with those to ensure long term compliance) or 90% for a Project fully covered by a Section 8 HAP Contract.

It's hard to calculate estimated returns (IRR) when buying a property if you can't or don't forecast the exit.IMO, the best way to decide how to allocate capital is to compare alternatives. 

Also, experienced investors do have to allocate some portion of either time to either managing the properties or managing the property managers.  

My bank requires that I allocate 5 - 10% for vacancies between rentals when they're computing my financing qualification so I guessing that it is pretty normal metric even though we typically average 2%.Rick