We let her go and she left us with a dirty unit with a cat-urine smelly suitcase in the basement.Overall, it really wasn't horrible as the unit wasn't "trashed" just dirty.

Horrible property management.

I get a bit under 11% cash on cash with 25% down and 5%, 30 year financing:Rent: $2200NOI: $1100Price: $175,000Down: $43,750 (25%)Loan: $131,250Payment: $704.58Monthly Cash flow: $395.42 Annual Cash flow: $4,745.06 Cash on cash 10.8%Doesn't seem like a great deal to me, but its not horrible, either.

It would be horrible to get into a property and see the market start to slip during a rehab, only to not be able to get refinancing after the updates.

It's a horribly simplistic way to look at "value" but if they know what properties are generally trading at then it's at least a starting point.  

Per your advice, I will try my best to keep things as simple as possible (I'm a horrible offender of overcomplicating things); so this was a very appropriate suggestion.

But the kitchen cabinets are horrible.

Conventional down payments, lower of Fannie or Freddie in each case (need to be working with a lender offering both Fannie and Freddie or this might not apply):15% down - investment property SFR (horrible rate w/ PMI), or owner occupied duplex.20% down - owner occupied 3-4 unit.25% down - investment property MFR.In all cases, 25% down is necessary for a rate that wont make you howl.

I've gone across apartment buildings that were mismanaged and (based on their asking price --- which should be adjusted for horribly low NOI) that would easily lose money on a 75/25 loan.

For all of the “pros and cons” of Section 8, the horrible response time of the CMHA staff and lead time to get anything done is the main drawback.