In reality, the insurance payout reduces the adjusted basis.

Additionally, many states offer property tax exemptions, significantly reducing expenses.

I could never guarantee that every student would find a deal but we have so many success stories and people have switched from investing in MF, MHP, Storage to office, retail, medical, industrial etc.   

Have you considered creative financing options like joint ventures or seller financing to reduce reliance on outside capital?

Found T&H realty services to be pretty interesting as they provide both buyer brokerage service (to help me find deals) as well as do property management i.e. they are not full turnkey provider necessarily, but reduces some of the hassle for me I guess as an out of state investor. 

I heard you mention that you worry about Tenant placement after the medical resource you have now dries up. 

I like this idea because it reduces the potential vacancy I could have by doing a short 3- to 4-month lease that ends in April or May, then starting over with a year lease.

The owners refused my advice to reduce price and they both sat vacant for months.

You won't find a deal where you live for free, but if you can live in a great neighborhood at a reduced cost of living that is a nearly risk free way to get started in real estate. 

Using seller financing allows your in-laws to spread their $217K capital gain over time, reducing their immediate tax burden and helping you conserve cash.