Focusing on the 5% down payment is an indication you place no consideration on downside whatsoever. 

Income from a trade or business where a taxpayer doesn’t materially participate.2.

@Lolo Druff Real Estate Investing is not like Trading Stocks or Crytocurrency.Real Estate Investing requires some deep thought and research from you as an Investor.Having 400k to deploy to multiple duplexes is a great start but you have some questions to ask and answer yourself.

Since all these Companies are publicly traded, you can read their yearly 10K'S and quarterly 10q reports. which are very transparent as to how they generate their profits and what risks their seeing on the horizon.

I don’t need the “media” to help me with simple math.As for the clout of Pace Morby…I couldn’t care less…as I’ve illustrated a SIMPLE story with some political spin can HAMMER a publically traded company.

Most landlord businesses DO qualify as a "trade or business."

I live alone in my parent's beach house and I don't pay any rent whatsoever, only utilities.

After the first year of renting them, and if their values have risen enough, I'll "trade up" for something else with a higher cashflow (assuming I go for a higher downpayment.) 

I’d like to trade it for this kind of property in this place. 

its kind of a trade off because i can get a newer property at a higher price and down payment, or get something older, less down and then use that money to fix what i need to fix.