Disclosure: I hold only SFH because I prefer the diversity of location and structure and consider the investments part of my resale & exit strategies.

I prefer my single-family $200k properties that rent for $2k per month :)

Handyman preferred.

However I would prefer to utilize some leverage.  

Since your preference is buy and holds plus flips, I added the below links for your review of these REI niches. http://www.biggerpockets.com/renewsblog/2013/01/04/how-to-rent-your-house/ (house rental guide)http://www.biggerpockets.com/renewsblog/2013/02/22/buying-rental-property/ (how to buy a rental property)http://www.biggerpockets.com/renewsblog/2014/01/07/flipping-houses/ (step by step guide to flips)To be more successful, you simply have to work on the other elements to progress your REI pursuit.

Structure their ownership as preferred holders with a return of 10% to 15%, (preferred pay out).  

While I guess it is possible to build a unit and not install ceiling fans, they are so common that not including one would be a negative in most renters mind.In my market, things like central air & heat, dishwasher, washer/dryer are amenities.I have never had a call regarding a ceiling fan from a tenant, but have had to replace one (1) during a unit turnover, as it was just too loud for my taste, but it was very old (~15yrs).

.:) My preferred way of selling a lease option, or any owner finance deal for that matter, is to create a single asset entity, either an LLC or a land trust.  

Can you guess which ones I prefer?

Also, he seems reluctant to kick them out (My guess is that they are his family friends.) and would prefer that they stay.