With proper planning, this can be a great investment!

@Anish KoshyThere is a lot of information out there on how to do your proper due diligence on a syndication, including the sponsor.

Connect with local investors and experts for a house-hacking strategy and ensure proper permits for rental properties.Good luck!

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

also noting most people arent' aware but the credit score run by a mortgage lender and say a general lender like a bank are actually going to be different scores (and likely slightly different ranges) - with some greater weights on mortgage debt for the mortgage lender Credit Bureau settings

Make sure you are properly screening your leads the same as you would for long term renters. 

While you shouldn’t categorize all tenants and it’s the landlords responsibility to properly screen, the tenants who reside in better situated housing and pay higher rents are more financially responsible meaning lower rate of rent loss and will generally take better care of the property which combined will result in less time allocated towards management functions if self-performed or more favorable management fee structures if 3rd party management companies are utilized (which ties back to #1, as well).

As long as you're making payments on time and have proper insurance on the property, banks are happy and don't want to call a loan due. 

Some buyers don't want your tenants who may or may not have been screen properly but some buyers like the attraction of having income on day one. 

Thanks James for the proper terminology.