For example, some areas SFH may exist but the clientele that move into them have to be comfortable with the neighborhood dynamic.

When they do, they are typically covered by insurance and settled outside of court.The odds of a landlord being sued for a large enough amount that it eats up their insurance, the equity in the investment, and their personal assets is almost non-existent.

For most of their existence Fannie and Freddie were privatized.  

@Brett Jurgens  What is your current financing terms on the existing loan? 

10% is not going to exist, 15% still does currently, but it will be very hard to make work considering the current environment. 

Do they come through and try to justify their existence by pointing out small things for you to fix or is it pretty benign and they're just making sure you're not a slumlord?

We take pictures on a pre-inspection only of existing damage, which generally doesn't exist because we repair anything that happens between tenants.

By then they are usually dodging calls and would just as soon I forgot they existed. 

we did that except instead of renovating it we knocked the existing home down and built a new primary. right after we were completed we had $500k in equity as we acted as the GC on the project. 

Not sure what the returns are on a 6 bedroom for rents are but those would be your numbers.As far as new construction versus existing, I'm not seeing the gaps that big in any size range.