Nevertheless, if the RAD investors  actually had loans  collateralized against property they would be in a much better position.

I know there's seller finance and "B" lender that are good for the short term, but if a balloon payment is due say in 5 years, there's no guarantee that my DTI would be in a better place then I'd be stuck without funding. 

Nice try, but this time does not count.In order to meet 750 hours, your wife will need one of the below:- do something else real estate related, like wholesaling or realtor- actively work on expanding your rental portfolio - have an extensive DIY rehab, like a month-long full-time rehab (and then she might need another kind of rehab)- a calamity such as multiple properties damaged in a storm where she will have to deal with insurers and contractors- something else out of the ordinaryAgain - if all you have is 9 single-family properties with stable tenants and typical occasional maintenance - you don't have enough work to collect 750 hours.

Similarly, if you put several Class D tenants in a Class A 4-plex, what do you think will happen to the property?

For example, should we focus on acquiring one high-quality property in a strong market, or would it make more sense to spread the investment across multiple lower-cost units in emerging areas?

How do you stand out as a desireable unit in a town that is saturated with many of the same cookie cutter condo 2b 2ba.  

Looking to invest in a multifamily in the raleigh/surrounding areas.

By this logic investing in a new roof also doesn't make sense.

It was in a over the garage office/bedroom that never got used.

This results in a reduction of your FICA tax liability for the year.