You will have holding costs along the way with repairs, maintenance, taxes, etc.

Right after I closed on that one the insurance company demanded I make a couple thousand dollars of repairs.

Delays, unforeseen repairs, and underestimating budget up front are all much more dangerous occurrences once a gap lender is involved. 

I created an electronic google doc time tracker: Time LogContemporaneous time log of rental real estate activitiesActivity DescriptionTenant recruitmentTenant screeningNegotiating and executing leasesOverseeing repairs and maintenanceCommunications with tenants and vendorsTravel timeResearch for potential rental real estate (pub 925)Acquiring rental real estate (pub 925)Paperwork/bookkeeping/bankingResearch and purchase of materialsRent collectionEvictionOn-site cleaningBill paymentOther:Time SpentDateMM/DD/YYYYSubmit

Lowering your standards invites expensive evictions and repairs. 

Based on an inspection report on one of the deals I worked on last year, I was able to negotiate over $15k of credits and repairs for a $200k house using a $400 inspection report for one of my clients.

Hey @Brad Roche - We do a significant amount of renovation loans (both Fannie May & FHA) here in Chicago and prefer the Homestyle loan only because it's less stringent on the borrow about what they have to repair, and they provide the general contractor a material draw at closing which helps the project start on the right foot.I thought the minimum down payment was 5%.

Repair costs in first 1 month of owning (this is renovated house done by seller, not me.

Renting at FMV allows you to deduct mortgage interest, property taxes, repairs, HOA fees, and depreciation against your W-2 income, potentially reducing your overall tax liability.

A CPA can ensure proper filing of rental income on Schedule E and help identify tax-saving strategies, such as optimizing deductions for maintenance, repairs, and travel.