So basically the answer is look for higher cash flow properties, keep your day job, and plow your cash flow and excess w2 income, into scaling your rental business.

If there is excess, the overage usually gets applied to principal and reduces the loan amount.Private Money, on the other hand, usually caps at 6%.  

No, you are charging more because they are using more and you would do the same no matter who occupies the home.If water use increased by $40 then I would charge the tenants $50 - $60 to cover periods of excess use.

If your budget allows a maximum of $250,000, do not consider coastal California.Climate - Properties in areas with hard freezes and excessive moisture will tend to require more maintenance than in milder and dryer climates.Property age - The older the property, the more maintenance it will require, unless all the major systems and components have been updated recently.Taxes - Both income tax and property taxes are a direct hit on profitability.

Rentals won't replace your down payment funds fast enough so you need to replace those funds by making excess income.

For example, say the seller and I signed for a purchase price of $50k to go to the seller, but if the assignor can assign the contract for anything over $60k, the excess would go to the seller on close. 

This will cover the dwelling in excess of the dwelling limit if for some reason the rebuild is more expensive than the anticipated limit. 

Not really all that uncommon of an occurrence, if a tenant cooks at high temps excessively, has buildup of grease on coils and/or has clean, but cracked, coils.

A deal just working out without a lot of excess "meat on the bone" is typical.

The addendum would also either need to ensure the tenants still took responsibility for any excess power used either by paying the utility for that directly or by paying you if you bill for that.Bottom line it's attractive to have others pay for an asset that improves home value.