Tacking onto what @John Koster said, the POS ordinances can be tougher in certain cities than others and the tax rates in the burbs can turn a dream deal into a nightmare rather quickly.I'd find a knowledgeable agent who also invests and work with this person to learn the areas and see what fits your investing profile.

If you were in Seattle you could not end this lease or month/month, no options at all, and you would be stuck with this person until they are carried out.

What is your personal situation?  

You could set up a “deferred down payment for 12 months” or have a stepped up down payment (so much per month until number is met) It's really whatever makes sense for the two of you.Things to consider, property taxes have to be paid, repairs have to be made, vacancies have to be accounted for, insurance has to be in the name of the person on title.

So the way I see it it's person's situation specific, as well as properties you have in your portfolio specific vs a specific amount.Good Luck!

I personally have not invested in a property like this before.

Personally, I would go after base hits 

@Katelin UhinckIf the commute is an issue you could buy a property that cashflows to go toward personal expenses and still have the long term benefits of having renters pay off the mortgage.

If the person or service is fantastic, there is potential for A LOT of business (~160 turns per year).

@Brian Willie personally i would not do this.