@Katie Par certain communities absolutely have restrictions on the number of units that can be operating as rentals at any given time.

Realize that your cost is completely restricted to what comes out of your pocket...like your DP. 

It's not the same as all cash, but won't be subject to the property condition restrictions conventional loans are and will still likely close MUCH faster than conventional, though not as quick as all cash.

How about we all adopt the enlightened rent control, development restrictions, and public transit policies of San Francisco?

If Covid restrictions don't allow it right now, do so when they do.

@Justin Harper, if there is an HOA, or restrictive covenant, preventing renting the property, then you could run into issues. 

I do not know if the loan requirements and restrictions vary state to state.

If you don't like paperwork or additional restrictions on how you operate then I would give it a second thought. 

(Wake had a restriction on off campus living and sought to maximize the amount of students living on campus, oftentimes room and board was more expensive than the cost of renting off campus).Look into the policies of the individual schools and try to find out what you need to rent to students in the area, that way you know what kind of process you'll need to deal with upon closing.

Once it becomes jumbo, your lender is going be way more restrictive.