It insures the Building, Contents, Loss or Rents, Detached structures, and Liability.  

He lives for 20 years - At 20 years it still wont be a loss maybe just not the best ROI.

Can you leverage the vacancy as a loss in value? 

Of course, anything can happen to anyone at any given time (health, job loss, etc), however, you have the highest chance of success with a Tenant who cares about their credit, and that is usually reflected in their score and report. 

The alarm has battery backup and will notify us of power or internet loss.

LPs need to comprehend the GP loss risk picture; it can often be lower than is usually inferred and LP should seek better alignments and transparency first.

@Michael LyonsYou’re gonna take a “loss” on those closing costs you paid for that refi if you turn around and sell.

Many of the most common losses (fire, water damage from pipes bursting for ex.) are preventable and usually don't take a whole lot of effort to avoid.Lastly, I would just say that documenting any conversations in regards to repairs you are planning to do when a situation like this arises is always best. 

I don't think vacancy, repairs, maintenance, etc. has factored into the equations yet.Priniciple, Insurance, Taxes, and Interest on a $307,500 loan should come out to a few shades under $2,000/month, I think that he is counting the rest as cash flow.

The previous owner must have been upset about his/her loss because there were holes in almost every wall, lights pulled from the ceiling, appliances damaged, etc.