I spoke with the agent a few weeks ago when I went to see the house because there was a squatter in it and subsequently I didn't get to see anything above  or below the main floor.

After talking with him he subsequently put the property on the market.

my rules:1. buy appreciation only when the bellow apply:a. its a 30% rehab (when your contractors quote the rehab for less than 30% of the purchase and subsequently ARV value is going to be 30% higher than purchase price+rehabb. 

If the values and the subsequent loans are too small, many brokers won't have an outlet to get it funded. 

Ballotpedia has a pretty good summation of the vacancy control clause in CA Prop 21, which will be on our ballot in November:Allows rent increases in rent-controlled properties of up to 15 percent over three years at start of new tenancy (above any increase allowed by local ordinance).The actual text of the proposition reads as follows:In any jurisdiction that controls by charter provision, ordinance, or regulation the initial rental rate of a dwelling unit, if the previous tenant has voluntarily vacated, abandoned, or been evicted pursuant to paragraph (2) of Section 1161 of Code of Civil Procedure, the owner of the dwelling or unit shall be permitted to establish the initial rental rate for the vacant or abandoned dwelling or unit provided that the initial rate established pursuant to this subdivision, in combination with any increases in the rental rate during the subsequent three year period, is no greater than 15 percent more than the rental rate in effect for the immediately preceding tenancy.

Do it right, and you might just eventually (after a few years and subsequent purchases) accomplish your goal of $5k/month, or even exceed it. 

Will you do all subsequent deals together?

Eligibility Requirements for Principal Residences4155.1 4.B.2.d Exceptions to the FHA Policy Limiting the Number of Mortgages Per BorrowerThe table below describes the exception situations in which FHA does notobject to borrowers obtaining multiple FHA-insured mortgages.Note: To determine the eligibility of a borrower for one of the exceptions inthe table below, the underwriter must consider the· length of time the previous property was owned by the borrower, and· circumstances that compel the borrower to purchase another residence withan FHA-insured mortgage.Important: In all cases other than those listed below, the borrower is noteligible to acquire another FHA-insured mortgage until he/she has either· paid off the FHA-insured mortgage on the previous residence, or· terminated ownership of that residence.Policy Exception Eligibility RequirementsRelocation- A borrower may be eligible to obtain another FHA-insuredmortgage without being required to sell an existing propertycovered by an FHA-insured mortgage if the borrower is· relocating, and· establishing residency in an area outside reasonable commutingdistance from his/her current principal residence.If the borrower subsequently returns to the area where he/she ownsa property with an FHA-insured mortgage, he/she is not required tore-establish primary residency in that property in order to beeligible for another FHA-insured mortgage.Note: The relocation need not be employer-mandated to qualifyfor this exception.Continued on next pageChapter 4, Section B HUD 4155.14-B-8Increase in family size-A borrower may be eligible for another home with an FHA-insuredmortgage if the number of his/her legal dependents increases to thepoint that the present house no longer meets the family’s needs.The borrower must provide satisfactory evidence· of the increase in dependents and the property’s failure to meetfamily needs, and· that the Loan-To-Value (LTV) ratio equals 75% or less, based onthe outstanding mortgage balance and a current appraisal.

I'm struggling with whether to buy-and-hold or BRRRR cash flow out of state or FHA into a new townhome here in SD, using our first one as the first "investment" when we rent it out subsequently.

I suppose you can try to take the buyer's appreciation in years subsequent to closing, but I am not sure whether such a tactic is even legal whether the property is sold and title passes, or is held in escrow.