., while John has a lot more experience than I do, and no real estate investor wants to be a restaurant operator, there are some upsides to Option 1, as I see it.The lower base rent could allow the Option 1 tenant to remain open throughout a recession, while option 2 may decide to close down the sales drop, if rent is too high.But beyond that, are a lot of factors that I would assess:Who is the actual guarantor on each lease?  

I have a CPA I work with who I’m sure will sort all of it out, just didn’t want to do something if it would cause a huge tax headache later.Do you know if you convert a STR to a LTR after a cost seg, will it cause a large repayment of taxes (I’m doing the cost segs to lower my W2 tax rate).

You're so lucky the propane tank wasn't closer...or the electrical lines...or the tree.It did melt the lower low voltage lines but the tree will recover.

I have enough capital and am investing in lower priced homes to be able to absorb any mistakes I make along the way. 

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

You are now 4% lower than what you are thinking and it sounds like you maybe 10% lower soon enough..

So, a seller will sell to a cash buyer instead of you even if the cash buyer's price is a little lower. 

Look to see if you can get scholarship or places with lower tuition. 

Zillow is trying to make more money from a lower amount of leads, this is not even the most expensive I've seen.

Oakland scares me, considering renting out my home if I decide to leave the USA for a lower cost of living country in the future, although I know a few people who bought in 2008 renting their homes out in Oakland and doing well.