It boils down to education and understanding more than anything.

While this is all good and fun, I understand that there is some criteria to meet when I eventually move out and have to apply for a rental license.

I'm wanting to expand my understanding on note investing a bit more. 

Dalton, I completely understand how frustrating a low appraisal can be, especially when your CMA supports a higher ARV.

I would explain this CLEARLY to them so that they understand you are not responsible to guaranteeing them a perfect experience.

I know the easy answer to this is "check with your CPA" but I'm still in the process of working to establish with a real estate specific CPA who better understands the nuances of these topics.

A major challenge for me (and, I understand, for many new investors) is estimating the price of renos needed, which of course makes it difficult to know what's a reasonable price to offer!

I've seen investors allocate 5-10% for capital expenditures (capex) and vacancy, but you won't have a clear understanding until you've owned the property for a few years and established a track record.

Just so I understand your point, are you saying expenses/labor rates, insurance, etc are higher in less favorable neighborhoods, rather than the upscale neighborhoods? 

Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers.