He has already given us a preliminary Loan Term sheet. 

I cannot afford for my first investment to not work out in my favor so believe me when I say investigation in my main concern right now.

I am just starting to investigate buying my first investment property, and am considering buying out of my state (CA).

OWNER assumesno liability to TENANT if such should occur as all products have a useful life and breakdown occasionally"My partner has a signed copy from the VRBO tenant.The way my partner has left it with the tenant is that my partner is investigating the issue and will get back to her.Does anyone have any advice on how to handle this?

They’re under investigation for fraud.

I don't have any experience there, but based on the metrics, it seems like an extremely solid place to investigate. 

From some preliminary research, it looks like the avg appreciation rate has been around 2.5-2.8% annually, is that about right in your experience?

For me so far: my own research for rents, comps and rehab budgetWhat am I missing that you would add in this preliminary analysis?

The fact that someone wants to arbitrage your property is a sign that it might be a good STR, but you have to investigate. 

I recommend you investigate some syndications.