that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases: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.

Co-Living, when done properly, should be less work per lease than LTR. 

Towson is great but I haven't seen anything in Towson proper.

We’ve taken note of your comment about the couch and are already looking into options—whether upgrading the cushions or replacing the sofa-bed—to ensure a more comfortable experience for our guests in the future.”My Recommendation:If extra capacity isn’t a top requirement, I’d opt for replacing the sofa-bed with a proper sofa (or upgrading its inner cushions) and responding as above.

At that class of property, the delinquencies are not low and have to be properly accounted for.The reason I asked how long you have owned is that it takes a while to recognize the sustained expenses.Obvious is to get rid of the poor tenant. 

I can do that for you if you are properly prepared with reserves and credit.

@Jordan Meltzer unless you find a screaming deal - a Class A property won't cashflow for 3-5 years.Class B: 1-3 years.Class C: most investors don't properly understand the risks, so should stay away from them.So, you may need to deal with negative cashflow, but plan on appreciation increasing your wealth.

Obviously each deal is unique and requires proper due diligence. 

Metro area will lead to there being fewer total units available, and higher occupancy in multifamily buildings.Population GrowthCoStar: Population Growth, DC Metro, United States (1/7/2025) Period Washington United States 2030 0.758% 0.498% 2029 0.758% 0.500% 2028 0.757% 0.507% 2027 0.765% 0.515% 2026 0.834% 0.532% 2025 0.966% 0.563% 2024 0.983% 0.569% 2023 0.707% 0.500% 2022 0.262% 0.423% 2021 0.004% 0.189% 2020 0.123% 0.285% 2019 0.946% 0.514% 2018 0.947% 0.562% 2017 1.058% 0.657% 2016 1.079% 0.762% 2015 1.125% 0.785% Washington D.C Proper surpassed 700,000 residents for the first time since 2019, showing the continued resurgence of the city since issues that arose for the city during the Pandemic (Source).

Borrower has the 3% loan in place for the duration, and 14% investor can be paid off with increased rent in say 18 months.