I will interview his past Buyers and find out how accurate the ARV numbers were.2) Sufficient cash to close all purchase agreements made, so as to keep their word to their seller if they can't flip it to a buyer.   

Once you refinance your original owner-occupier loan into a conventional investment loan (presuming that you have sufficient equity built up, and the rent return would sustain positive cash flow even at 75% LTV with the higher interest rate), your next low interest owner-occupier loan can still happen for your next primary. 

(And they are quite lax in our area)No windows in the window openings.Sewage draining into the basement.Exterior door knobs that do not work (or missing doors), so the house cannot be secured.Broken stairs that someone could fall through if they step in the wrong place.I could go on, but these are sufficient. 

I am traveling at the moment though so you can also fee free to reach out to Ken Klingler or Jack Inman.Also I am making up ALL OF THESE NUMBERS because I am typing from a Motel 6 in the middle of nowhere. 

It’s all the tenants money I would be applying to pay the loans down.My thinking was at some point when you have sufficient doors/cash flow, then pay it all down. 

Caveat is that turnkeys sell for the high-end of market value, so disposal in the first few years will likely lose moneyCONSSpecific market and asset risk is long-term (per property - mitigate by diversifying across different markets and property types)Spreading risk across multiple assets and markets requires multiple investments and quite a bit of due diligenceTurnkey properties (along with most other single-family homes) are becoming harder to acquire and thus more expensive, compressing returns and making it harder to find properties to buy with solid cashflowPortfolio risk from individual units is high (until sufficient number of doors achieved to mitigate this risk)Using leverage requires qualifying with personal credit - may become harder/more expensive with recently-announced changes at Fannie MayRequires some effort (to "manage the property manager") and decisions required at some point for capital expendituresQUESTIONSWhat unique risks are there with the turnkey single-family rental model?

However, at some point I dropped tax liens and associated investment from my portfolio because (1) the vastly different nature of the investments depending on state and even municipality (2) the crazy amount of competition resultant from the publicity being generated (3) the decreased ROI of available tax certificates (4) the time required to research what could turn out to be a relatively small sum invested and (5) superior returns available in our other investments.I came to the conclusion that tax lien/certificate investing can be very profitable IF the investor gained intimate knowledge of the procedures in a particular state AND gained knowledge of property valuations in that geographical area AND had sufficient capital to invest to make all the “legwork” worthwhile.  

We do have a sufficient emergency fund.

You'd expect they have the sufficient flood insurance to cover the damage and rebuild whatever needs to be rebuilt/fixed.

Simply showing that the 50% rule of thumb is one way to reduce the risk of a negative cash flow investment is sufficient.