And given #3 above, it leaves about 20% of rent for all other expenses like property tax, insurance and other PM expenses like leasing fee, eviction fee and other minor expenses like for e.g landscaping, pest control etc.

Pros - guaranteed rent, tenants stay longer on averageCons - more mgmt needed (lease violations), they tend to not take great care of properties (increase maintenance expense or deferred maintenance)

However, eviction must be by cause (i.e. you can never evict without a justifiable reason - so more or less you are stuck with a tenant unless they stop paying rent or breach their lease, or some other narrow units such as moving in or curing code violations - though then you have to pay relocation costs).

Consider hiring a paralegal well versed in leasing, renewing, and evicting.

I was told that I have to use the lease value * 0.75 until there are two years of rental income.

Tenant stopped paying rent before 2 months of the lease expiring, property manager filed for eviction process but tenant vacated the property before sheriff served the notice.

Tenants in lower Classes will have lower credit scores, which means higher chance of defaulting on their lease payments.

Quote from @Chris Seveney: @Jay HinrichsAccording to the site:To purchase real state/real property, perform rehabs where necessary, lease the properties, collect rents, distribute income as dividends to shareholders.Rad Diversified realizes revenues from rents and interest on certain investments, as well as capital gains from increases in the value of its real estate portfolio.They are a REIT so they have to distribute 90% of their taxable income per year (which of course could be zero due to depreciation).  

@Anthony MillerYour property management experience is a major advantage as you start investing, giving you a head start with tenant screening, lease agreements, and maintenance coordination.

What about closing costs, rent ready costs, lease-up costs?