As far as the insurance claims, I've had many. 

Also you should inquire with insurance agents about the cost to insure.

The way I interpret the following policy clause is that so long as the property is defined as other than "VACANT" which is the case when the property is being "constructed, altered or repaired", the 30-day time period and vacant status does not apply in this instance: We do not insure any loss at your premises if your dwelling has been vacant for more than 30 consecutive days immediately before the loss and the declaration page indicates an occupancy other than “VACANT“.

The insurance is higher along the coastal areas because of potential hurricanes but not bad the further north you go.  

According to Warren Buffet, Fannie and Freddie really failed because of high-leverage risk-taking in the fixed income arbitrage space, saying:“The portfolios are what really got them into the trouble…the managements of Freddie and Fannie tried to juice up the earnings, basically, because the insurance guaranteed that they were given that mortgage.

Maintenance/cap ex, insurance, if a rental PM, bookkeeping, misc.The fact you have a loan means 1) leverage 2) equity pay down.In addition, there are tax benefits.So I will do some rough underwriting as an OO non-rental at 95% LTV (because FHA has some undesired consequences that make the 1.5% difference in LTV worth avoiding the FHA).equity paydown: 20% (using OP interest rate at 95% LTV and not counting closing costs). 

With that they may be able to recoup from their renters insurance (hopefully you require this)  If locks are damaged and the unit isn't secure you would need to take care of that right away.

That is unless you have a JV or other equity partner who is putting up the funds immediately with no lien, title insurance, etc.

That (and insurance issues) are two big risks.

I'm feeling for this guy and his wife's health.