In conclusion, I think a general assumption of ~15 years ROI is reasonable, and I believe if you really dial in the usage and match the system config to optimize, you could drive down to a 8 year ROI.

All of my assumptions were based on that 2 unit residential and are fairly accurate between rental rate and ARV. 

(This, of course, depends on one's assumptions about future appreciation; the prospects of which I have my doubts.)

Absolutely love your #1 My assumption is the OP will stay pay for an overly complex structure that adds limited value except to the pockets of the service provider

The only assumption I make is that the house will need to be gutted.

Once you see how much it cash flows, you can divide by your total cash investment to find the cash on cash return, then make assumptions about appreciation and mortgage paydown to find your total return.  

Let's assume from here on out legit operators in both spaces because while fraud certainly exists, even from the property owner side as well, it will be very hard to make good assumptions about it.The start up costs are very different for an MTR operator compared to an STR PM.

Assuming a note is enforceable is a very bad assumption to make.While seller financed notes may have some degree of predatory practice related, such as a sale price higher than market value, such issues can fade away in time as the note is seasoned.

@Scott ChampionRecommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.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 Class A property in Class D area, what quality of tenant will you get?

The two big risks I see in your assumptions is: lease up time (6 months, generally, sounds short).