So with the dramatic rise in rents, landlords like yourself are trying to rent a "C" class property at an "A" class rent and then being surprised when the "C" class tenants can't afford/qualify for that high of a rent (or the tenants' applications have blemishes more typical of that class).

However, due to the "unmitigated settlement" the house is now blemished, meaning buyer/occupiers will have a hard time getting insurance/mortgages. 

The amount and number of these blemishes can certainly rise to "Abnormal wear".

: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.Tenants: Majority will have FICO scores of 680+.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.Tenants: Majority will have FICO scores of 620+, 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.

If you did accidentally cause that blemish, consider $500 a great deal because that sucks for the Landlord.

They sell blemished stuff(but you can't see the blems).

: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.Tenants: Majority will have FICO scores of 680+.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.Tenants: Majority will have FICO scores of 620+, 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.

If there are credit blemishes, I think the most important thing is to look at the nature of them and decide whether you think they tell you anything about the prospective tenants inclination to pay you or not.For example, our best tenant so far had some credit blemishes.

If you get flat paint there will be more blemishes but you can do touch ups. 

If that is the only blemish on a 70-year-old foundation, I would say that is a good thing!