You thought it was fine until one person complained and now you have a vacant place and your PM wants to be your realtor. 

I will be surprised if, over the long term, the 50% rule cash flow estimate can be attained.Your expense increase at 1% would be fine with 30 year fixed, but 7 year loan will result in loan costs in 7 years that likely makes this 1% increase not obtainable. 

Although I agree as a relative rule of thumb cash flow of ~$200/mo per unit is fine, I would have a different perspective if I purchased a million dollar SF which cash-flowed that amount vs. a $75k condo.

Then we enter negotiations, which is fine for me as I can always walk if they demand too much. 

So long as you don't plan on selling either property within the next 12 months you will be fine.

If you're a buy and hold guy, then buy a decent condo by a well-known developer at a AAA location and you'll be fine.

Don't the right way it is absolutely fine to do.AJ, good luck!  

In terms of risk, I am fine with it as long as the numbers makes sense.. especially if instead of earning 200 per door, it could potentially be 1000 per door.  

If youbuy good deals and are strategic then you will be fine.

While this is fine for a period of time, I would like to figure out a longer term solution.I've thought of getting a co-signer on the mortgage, as well.