Aside from the financial reality that a PM will consume over 1/3 of your cash flow (~15% all in with all fees included of GROSS rents, which is likely >30% of NET),  managing a bad PM is MORE work than managing a good tenant yourself ... a vast majority of PMs are bad (PMs and newbies will argue otherwise, but this has been my experience) ... if you buy quality properties in quality locations (see Sales part in OP) and then screen your tenants, then most tenants are good.I would also hope that this post would dispel the common false belief that REI, at least as far as owning individual properties, is or even should be a passive investment ... it is not, it is starting and running a business just like any other.

I'm going to disagree with the consensus, and provide a different perspective that I think is missing from this conversation: that of the experienced, conservative investor.The reason a conservative investor requires a sponsor to put skin in the game/cash in the deal has nothing to do with falsely believing that it somehow guarantees that the sponsor won't bail.

For example one tenant wanted his unit repainted they had been there a few years so it wasn't an absurd request.

The local management said, I gave you monthly statements, P&L and balance sheets, that should be enough.What happened was the money partner hired a private eye to check, and found that all the financial statements sent from the local management to him was false.

That is completely false.

You could have a bad seed, but the false sense of security/diversity could force you to use a mediocre PM.

This post is very well written but I think you've missed a few critical expenses that give a false picture of success, which is common among the AirBnB investors.First off, how did you purchase an investment property with just 5% down?

@Mike Dymski25% seems like one hell of a tremendous return, but yes this whole thing is absurd.These guys have gone from single family deals for short term rental model with unsophisticated investors basically splitting cash flows 50%, and getting 30% returns before asset appreciation, so maybe 40% returns if they are able to sell them at a good cap rate, to wanting to do multi-unit (20-100 bed) hotels, and think they are earning too much for their investors so they are proposing something absurd because its pretty obvious they aren’t familiar with institutional money and their return requirements.

Investors created alot of "false demand", particularly in new construction.

My upper hand is that because of my stage of life I dont have anyone depending upon me and my current living situation is absurdly cheap, so I virtually have no real expenses which would allow me to get things moving.