It's bordered on 3 sides by SF communities that are selling out quickly.

Sounds like you did not do any homework and its going to kick you in the butt and it sounds like you gambled on this one. 

Definitely up, so the gamble on rates cannot go your way.I had one ARM in the past, and it went my way when it adjusted, but only because the market collapsed.

@Harry Gamble The cost of insurance will vary greatly based on the individual property types, specifics, and locations.

There's extra capital needed to remodel the 3-5th floors, but I don't know what kind of options there are for funding that.The area is on the border between downtown and a less friendly neighborhood, but the city just got a big government agency to move in about a year or two ago.

The southeastern coast of NC, from Jacksonville down to the SC border is highly driven by northern retirees moving and 2nd homes. 

I live on the border of Murrieta and Menifee (Mapleton) but the entry price points and short term cash flow are keeping me looking out of state for my first deal but I am very interested in what locals are doing for their first deals.

Nick, Since you will be occupying the house and taking in borders try using DPA and seller concessions to make the first purchase.

Close to the border of MA...

If your wiling to drive a couple hours over the border to NV prices are a bit lower and leaner landlord laws.