Some lack the skills to do certain things but have realized some percentage of a return is better than 100% of no return.For me, I'm happy at 15+% CoC returns... some want a minimum of 20%.

And your lack of transportation will make both finding and managing this property a real challenge.

You have to consider where the pipes will go for both water supply and drain, where the shut-off valves will be located, whether a window or skylight is present or whether exhaust fan is needed, where the vent for the waste will go through the roof, whether you have electric wiring that can accept a GFCI (old house might only have two conductors on many circuits, lacking ground wire).

I'm by no means an expert, this is simply what I have read and heard from various sources over the past year.

Would it be easier to find the house, assign it to my buyer, and simply make the loan?

If you are not taking in any rent you may consider this a second home and deduct mortgage interest and real estate taxes as if it was simply a second home.That would be why they cannot depreciate it.In some cases such as additional depreciation allowed on business(non-rental) assets you may take additional depreciation the first year.To summarize:They will not be able to depreciate it unless they are in a for profit activity.

Why not simply get the home appraised and do an FHA at appraised value, giving the bank 3.5% down and completely eliminate the owner from the equation?

After all the original FHFA RFI was geared to "all" solutions, it is simply curious that so many came back with the same ideas that were already "floated".Anyhow, the 8% is of course relative also, is it an unleveraged return using leverage monies, is it guaranteed risk free, is it including capital appreciation, etc.

You would simply say "based on an appraisal performed at the time the option is exercised".

Simply put, your not an owner.