We will use the high end of this range ($100k)   This implies the initial negative equity position is $150k  $150k (initial negative position)/$350 (cash flow) takes 428 months to recover the initial negative position (35 years).  

We are looking for 3 year lease if that is acceptable with you.My initial reaction was to decline this offer.

Initially, this might seem like a great idea as you can maximize rental income by renting out bedrooms kind of like college student rentals.

Hey John - I appreciate your initial reply.

The longer the time between their initial request and your response, the less likely you are to get a booking.People do not tend to really start looking for a place two weeks before their assignment begins.  

The initial thought is you are probably charging too much if no one is interested, or your photos or description are bad.Four beds and only one bath probably reduces demand as well, that’s potentially a lot of people sharing one toilet.And it is winter - I’m in Buffalo, I hate listing rentals this time of year.

This outlook is reflected in the prices resulting in poor initial cash flow but historically great long term cash flow. 

So in 3 years if you bought a $150,000 house, you would likely have accumulated $12,000 -$20,000 in equity on your $30,000 initial investment - not to mention your tenant paying down your mortgage, plus some really awesome tax advantages (3.3% depreciation, etc.), plus hopefully some cash flow!  

Also you mention he has an awful reputation yet you acknowledged in your initial post you repeatedly buy properties his brokerage represents...not quite adding up.

The letters are pretty vague and when you look on the EPA website they talk about a 10-year initiative.