When we rate it up we have to indicate that it is not owner occupied.

He is also a contractor who says we need minimal (2.5K) repairs to make them "livable" - that term scares me. 

@Meir GreenblattI used to think the same way you did as it sounds like a great idea in theory (limit capex for a minimal fee).

You may want to consider house hacking first to lower your expenses and be able to utilize your cash better.The fact that you are setting goals and are planning are great indicators that you will be successful.

Can you refer us to where that part is in the new law: AB-1482 Tenant Protection Act of 2019 The same paragraph that indicates the 5% cap (search for 5%) indicates something akin to rent discounts, incentives, credits, concessions, etc are excluded from the base rent.  

I would much prefer an empty apartment to one filled with a questionable tenant.As @Jonathan Taylor Smith said, you need to have your qualifications in writing so as to minimize the perception of discrimination. 

Proximity to Disney, Universal, and SeaWorld help a lot with minimizing vacancy.

I was also originally thinking for wholesale, even if my fee is minimal... just so I have the experience under my belt.

And I was curious if there a way for me to actually buy a duplex or higher on a FHA loan or a loan without large down payment, so basically no or minimal money down.

You don't get the depreciation , the return is minimal 4-6 % , still better than banks , but the money is tied up for years ,  you can't leverage it or refinance for another deal whenever you need .