Make sure you are compensated for this risk appropriately or don't do the loan.

c) Exceptions The term ''personal holding company'' as defined in subsection (a) does not include - (1) a corporation exempt from tax under subchapter F (sec. 501 and following); (2) a bank as defined in section 581, or a domestic building and loan association within the meaning of section 7701(a)(19); (3) a life insurance company; (4) a surety company; (5) a foreign corporation, (6) a lending or finance company if - (A) 60 percent or more of its ordinary gross income (as defined in section 543(b)(1)) is derived directly from the active and regular conduct of a lending or finance business; (B) the personal holding company income for the taxable year (computed without regard to income described in subsection (d)(3) and income derived directly from the active and regular conduct of a lending or finance business, and computed by including as personal holding company income the entire amount of the gross income from rents, royalties, produced film rents, and compensation for use of corporate property by shareholders) is not more than 20 percent of the ordinary gross income; (C) the sum of the deductions which are directly allocable to the active and regular conduct of its lending or finance business equals or exceeds the sum of - (i) 15 percent of so much of the ordinary gross income derived therefrom as does not exceed $500,000, plus (ii) 5 percent of so much of the ordinary gross income derived therefrom as exceeds $500,000; and (D) the loans to a person who is a shareholder in such company during the taxable year by or for whom 10 percent or more in value of its outstanding stock is owned directly or indirectly (including, in the case of an individual, stock owned by members of his family as defined in section 544(a)(2)), outstanding at any time during such year do not exceed $5,000 in principal amount;"

Also, it's important to note here that I am not expecting the realtor to do anything for me without compensation.

So as people need to make up the difference in a downpayment to compensate for the loan limit, this pushes buyers out of that nieghborhood to more affordable housing, creating the plateu of price effect.

If you can buy to compensate for the added risk and tiime it can be profitable. 

In this case The vacancy Factor and " turn-around" expense for the Average $ 2500/mo rental here are considerably higher than these estimates I don't see anything factored in for " Management" for either a PM or Compensation for time spent.

It is fine to take on the additional "risk" of a monthly tenancy, but is equally appropriate to be compensated for that risk.

You take a risk which could result in cancellation of your title insurance and complete loss of your real property without compensation in the event that a title issue regarding your real property arises.Contact your title insurance company to determine coverage and if your policy does cover transfers , and when or how. 

For example, are there any limitations on such compensation being paid by the owner or the management company? 

You want to see coverage for at least General Liability, Professional Liability, Workers compensation, and Business Auto Liability.