The best market is likely a "Good" cash flow market that you have some ties to, in some way shape or form, or one that is a reasonable drive from where you live, if practical/possible. 

Agents are also advising you to look for expensive mistakes (like checking the sewer which could cost 5-40k) and using their network and contacts to find homes off market or FSBO.  

It's not a bad strategy, especially if you live in a lower-priced area with a good rent-to-purchase price ratio.

Utilities for the Rented HouseDeductible as a rental expense from when the property was placed in service (ready to rent).

There isn't enough cash flow in these deals to pay the mortgage, monthly expenses and the HELOC that I'm trying to leverage against.

Too bad you can't buy something owner-occupied, put 5% down with the best interest rate, live in it for 12 months (and fix it up), rent it out and repeat the cycle.Here's some other info you might find useful:----------------------------------------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

We live in a microwave world, where everyone expects their investment to soar overnight.

Find out what rate rents are increasing and expenses are increasing in your area and use that in your underwriting, then work out each year of ownership. 5% rate in 5 years seems ambitious.

My suggestion would be to cap your utilities at a certain amount and have Tenants pay anything over that amount.That will help you manage your expenses, and also allow Tenants to gage their usage each month, and make adjustments if they don't want to go over the allotted amount.As far as collection, provide the bill showing any overages and just have them pay for it along with their rent. 

Since STR “lives” on reviews, being “right” because of the contract the guests signed might be the most expensive “right” you’ve ever experienced.So what’s left for the “wanna be” STR investor in today’s market?