>The upside would be passive income in the range of $3500moNormally I do not see people with residential experience refer to it as passive income.  

There are a few options that some people have used when they were looking to buy a new home before selling (and ran into DTI issues). 

We live a couple of hours from the property and needed local people to lean on in emergencies.

There are lenders that work with foreign nationals (people living outside the U.S. that are not U.S. citizens or have permanent resident status) to buy investment properties with DSCR loans.

How should a escrow account be created when there are two people on a lease (two friends staying in a 2BR condo). 

This is the #1 issue that most of the operators I work with have issues with.A strong maintenance process means you have a CRM with all your people, a basic understanding of rates, contracts in place, and backups. 

They MAY somehow get lucky and flip one deal for a small profit; or get VERY lucky and hit an area going through rapid price appreciation and be able to leverage that for a short period of time.  

I do think the market here is a bit saturated personally & many people I speak with are seeing they are not as booked.

Income-based lending is mostly for people with traditional jobs.

Get great photos, offer similar amenities as people in your area.