I also think you can get 6.5% interest these days so that should be closer 30k a year for P&I.I just don't see how you can lose money like that if your gross rents are 100k on a 500k purchase price and you're putting down 20%. 

And I am doing CD's not LWO's which the #'s with LWO's are even lower close rate than CD's.

Looking closer I can see why someone may feel that way. 

I’m sure I can invest somewhat closer to me but it’s very pricey I’m in NJ.

Using the annualized NOI of $1.35M vs budget of $1.16M is $190k at a 5.6% exit cap is a minimum higher exit price of $3.4M, likely closer to $4M once income rebounds, of which you keep $2M in addition to your millions in other fees and promotes. 

My question is: Is this house better off being rented long term for tenants or should I gravitate toward a midterm rental for possible traveling nurses or traveling professionals who want a cleaner, more up to date space, closer to downtown?

I personally would avoid the older neighborhoods closer to the post.

But it looks like we might have to accept that rates will be much closer to 7%. 

Yes The utilities and common area cleaning are included into my expanded monthly cost. im modeling this closer to a hotel than a traditional rental.

That means either you won't cash flow or your Return on Equity (ROE) will be terrible.Since this is your primary residence you'll be exempted from paying capital gains taxes when you sell.If you sell to your parents, it will be considered a non-arms length transaction and will get closer scrutiny.