Welcome @Terah HarrisMaybe also consult with a real estate agent, attorney or free legal advisorThis would help with your local laws , fyiWorse than is to have unwanted or undesirable tenants

You have funds; no need to waste time with peripheral industries.Wishing you great success!

That is not to say the subdivision is undesirable, just the subdivision is small or there hasn't been much activity in the last 6 months (maybe 1 or 2 solid sold comps).

That is not an assumption you should take lightly.Another approach, which requires some leadership skills, is to buy a great complex a large discount because it's on the edge of an undesirable neighborhood.

The only existing buildings in my market that meet those requirements are retail buildings which could be converted for our use but, typically retail space that are good deals (foreclosure, bank-owned, etc.) are in very undesirable areas or are too small or much larger than I want to take on.

I do agree with you, regardless of the classification of "vacancy", having money going out while none is coming in is most undesirable

The tradeoff is you get a lockout, prepayment, or other undesirable terms on the front end of the loan for this type of product, presumably so that the lender is guaranteed an income stream or some minimum if you decide to sell, refinance, etc. early.  

Also, the statements "we do full background checks" and "we partner with law enforcement" turns off most of the undesirables.  

MY GOAL is to show ALL THE POSSIBILITIES, and to open everyone's thinking to looking for the positives each time an opportunity is presented.I believe we'll all be more successful, if we continually learn how to turn more "undesirable situations" into opportunities!!!

The thing to be careful of is that by applying an arbitrary 2% rule, it can lead people in to cheap, undesirable markets.