They say the average amount of water per day a person uses is 80 to 100 gallons , Lets call it 60 to be conservative .

This seems to be breaking down new construction and is a national average so kind of hard to read into this what it means in general but I would not expect a 665k new construction house to be my target for a rental property. 

So they often will reduce the leverage of the loan (getting 65% instead of 75%) or deny it (which isn't as likely). 

@Chris Lin not sure where else you own properties, but all their fees are what is normal for the Metro Detroit area.We have heard some PMCs offer lower fees in other parts of the country, but from what we've researched, these only apply to Class A properties - which are REAL easy to manage.We actually charge LESS than average to manage Class A rentals in our market.

2) What's the average rent for each property and how many bedrooms?

I am not an accountant or tax professional so I would recommend talking to your account about what that means and maybe some strategies on how to reduce your tax liability

@Parker BullardFrom my experience, house hacking is a great way to reduce housing costs by renting out part of a property, like a duplex or triplex.

2.Are there strategies to reduce the required down payment or secure better mortgage terms?

In my experience, the average Section 8 resident behaves differently than the average market rate resident, and the government-backed rent is not worth the added hassle.  

They clearly had no intention of paying off the loan in October but sought instead to further reduce their loan balance during a time of the note holder's personal hardship.