@Anthony Angotti On a longer term horizon, I'm setting aside 60% of income for CapEx/Repairs ($500) to get the building up to MY standards.

You make it up in 3 ways 1) The government is loaning money at very low interest rates 2) The property appreciates in value because rents go up 3) The mortgage gets paid down while you own it (if your loan is not interest only)All of this works very well in today's environment but just be careful you're not holding one of these properties when interest rates are 10%, rents and occupancy are dropping and your note is called.But if your investment horizon in the PPM is 3-5 years what could go wrong?

Buying raw land is usually a longer investment horizon, but as you know, every deal is different. 

What's your investment horizon?

Lastly, I self-manage this home.It may only be my experience, or lack of experience, but I don’t see myself earning enough passively to retire within a time horizon I would like (5-8 years) via single family homes. 

Speak to the HOA and explicitly ask "Are you aware of any special assessments or HOA fee increases on the horizon"5.

They feel like they'd working their tails off for a modest amount of monthly cash flow (though they do own half of the equity that was created, which totaled $350k or so), while he gets $2,500/mth or so with a zero net investment (now I know his credit and finances are on the line for the note, but this is their perspective).So these deals where there is a multi-year (or indefinite) time horizon, particularly when a lot of equity is created and no defined end game, are just rife for unhappy participants.

An inspection will reveal any CapEx costs on the horizon so you can plan that into the price accordingly.Congrats on finding a deal off market!

Widen your horizons, think outside the box.

The goal is then make money off of the fees as a syndicator and hopefully through cost savings and rent growth blend the cap rate up over a 5 to 7 year horizon then exit.I syndicate but retail properties.