you are kind of dealing with three diffrent issues here, the thing about not being a legal three unit, super easy don't buy something that's not legal, and your agent really shouldn't be encouring you to break the law, the issues with properties being beat up, the vast majority of multi unit's that sell have some wear & tear that's often the reason for selling, being a tired landlord, if you want turn key, you are proably looking more single family homes or paying big dollars for a turn key multi if it even exists in your market, 3rd we can debate the pro's or con's of this this market but youve hired and agent and 99% of agents are going to tell you its a great time to buy, i'm usually more measured but that's because I have a deep psychological problem in which I care more about being intellectually honest than making money, most agent's however are not afflicted with this disease so your gonna have to make this decision for yourself before you hire any agent.

It also depends on the structure you want/can put in place and the associated costs, the equity amount you want to protect (50K might be high for me, but you might not blink till higher than 500K), your risk tolerance, all subjective measures. 

Yield though is a measure of risk in the asset or market.

Although, some lenders will go off the lowest list price, if by some measure the property does appraise higher (just something to keep in mind).

And I’m looking to understand how a townhome value is compared and measured. 

Moreover, as we see happening in Vermont, you might see legislatures aware that pursuing aggressive measure less from the perspective of outright bans that de facto bans through excessive, targeted state and municipal taxes.

Land Constraints: - Surrounded by dense mountains, our small market only measures about 15x20 miles. - Lots of demand from Northern California, and not a lot of supply. 2.

I do not know how much they contributed to the two defeated equivalent measures but I suspect it is a similar amount. 

You will know exactly what is in each house, what the measurements are, etc. this means that if you have many you can have a standard depreciation schedule for them, it also means you can track statistics on repairs (a quote for a single home is completely applicable to any other property), how long appliances last, etc.

With that loan product, they will not be looking at your DTI or work experience and will qualify the property based on the DSCR (Debt Service Coverage Ratio), which is a measure of the property's cash flow.