Why this is King is because in San Diego it is extremely difficult to buy a 3-4 unit property with a primary residence loan since nothing tends to pass the self-sufficiency test whereas the VA loan it is not a requirement. 

Alternately, you can ask for the property to be delivered vacant.It’s a small town so I wouldn’t want to make the property vacant as I’d have a difficult time filling all the units quickly.  

Or just stay with the old carpet, covering the holes with rugs, esp since moving furniture in and out of the unit makes it difficult? 

But most people fail not because it is not possible, but because they don't do the difficult things it takes to succeed and they give up long before they reach the goal. 

In my experience, it is the most difficult option, only once has it gone smoothly. 

This can be a difficult and slow process with limited capital so start it sooner, rather than later. 

But from the groups that I've joined everyone says that Portland is too difficult to manage a rental.

They are taking all the risk with no premium for the higher risk deal.It is not that sellers financing is impossible in a sellers market, but trying to do it at unreasonable terms for the seller may be difficult.

It can still be month to month, but now it will be written out, you will know exactly who is there, where they work etc etc.Nearly doubling their rent to market is a bit much but if you went to say $1000 now it would be difficult to go to market in 3 or 6 months.What shape are the apartments in?

He's unmarried and and just five years out of college, he's living in young 'hip' area,  his rent is under market and it would be difficult to buy a property in his area that would cash flow as a rental so it makes sense for him;  I think in the situation you described it would be a reasonable thing to do as well.