As a result of being federally charged with these crimes, you may face monetary fines, penalties, prison time and other consequences of Equity Skimming.Equity Skimming and related penalties of sentencing are detailed in 12 United States Code USC Section 1715Z-19.

: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.

As I mentioned to Michael, I'm attempting to see if our returns and operations are relatively inline with the expectations of experienced STR operators.

I can relate to where you’re coming from as I’m also new to real estate investing and actively working to build my knowledge and network.

WIth that said "passive" is relative lol. 

Best to call city hall for the town you are buying in to see what if any rent control rules are in place. see link below if you require additional information and call the Jersey City Landlord Tenant relations office. https://www.jerseycitynj.gov/cityhall/HousingAndDevelopment/...Jersey City CPI chart on recommended rent increases: https://cdnsm5-hosted.civiclive.com/UserFiles/Servers/Server...The state with the highest eviction rate in the country right now is South Carolina. 

I have several current and former clients that have done similar projects, mostly in neighborhoods where either 1) they grew up in the neighborhood, 2) they still go to church in the area, or 3) they have a relative that still lives in the area.

Quote from @Jerem Kaawaloa: I have spent the past 20 years working in health care and have only ever purchased properties for my own use, including a home and office.

I've always found inventory rates (and how they've moved over time ie previous 1-2 years) to be the starting point for where a market's health is at.

While that may be good for the 10% pref investors, you may have been better off holding another year and getting another 7%.Related to this, I generally don't like preferred returns as a passive investor.