You have to guarantee the loan but you are not a buyer of the property. 

Myself I am not sure that those buyers would go for tight living conditions that are condos and for sure are not going to be renters..  

The one issue for most first-time buyers is that these properties will often end up needing to be rehabbed. 

The estoppel is a form filled out by the tenant, then confirmed by the Landlord, and then accepted by the Buyer.

That being said, while the intent is that most investors in a 506(b) offering are accredited, the sponsor can accept up to 35 "sophisticated" investors into the offering and still be within the rules.All told, private offerings are 100% a buyer beware investment.  

We keep seeing conflicting views but my personal experience with buyers indicates that the outlook is positive.   

The only exceptions I can think of are a lack of experience frustrating your financing process or where the GC has such a well established brand that a buyer will pay a premium for a home built or renovated by that particular contractor.

The properties I am seeing in this situation in Toledo have been sold to the 1031 exchange buyers at extreme prices.

Quote from @Luis Herna: Let say I am a licensed real estate agent in oklahoma and there is one buyer in new York wanting to buy a property in Texas.

However often the properties are not really in the better parts of town and don't always attract the best tenants.I've always thought real estate is not as passive as people will make you think and maybe the buyers want.