I believe San Diego is a great RE market but the reality is it is very competitive and most purchases have negative initial cash flow.  

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

i only see suitably distressed properties hit the MLS very occasionally. 

During that time I've often described the multifamily market as a traffic collision at a 4-way intersection where you had (lack of or negative) rent growth coming from one direction, and from the other directions: cap rates, expenses, and interest rates. 

I've largely stayed away from the "sub-to" buz word, but I have done a couple sub-to flips knowing that I only needed to hold onto them a couple months and I was prepared to pay off the notes if they were called.Sub-to for long-term hold on the other hand has me nervous. 

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

Tenant took photos and videos but nothing detailed - a single shot or two of a room from the entrance, so is saying fridge was fine, normal wear etc Next - If we are being nice and deducting ‘portions’ of the charges and tenant continues to grind away, or this goes to court, do the compromise and smaller amounts offered negate the full amounts that could have been charged

I have been a part of companies as a W2 employee that literally one day they walk in and shut it down because the day before their funding dried up, or their was some negative news. 

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.

Also, focus on 2 years of job/income stability.Class D Properties:Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciationVacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions.