You can leverage your time to work on SEO - but in DMM - you're capped by your financials. 

Any recommendation on how I can make this deal work with a difficult seller?

Not stuck in an office all day, everyday.Some cons:-initial expenses and tough to build steam (I'd recommend at least 3-6 months of reserves to get your business off the ground)-odd hours (usually showing homes/on appointments after 5pm and weekends)-lots of competition and rejectionFor me, it's been difficult but also wonderful. 

Right now, it seems to me that cashing out to get a deal makes the most sense…but I’m apprehensive because I don’t want to have a misstep now that will make it difficult to get a home in the suburbs later on.

About $200. per month per unit after expenses, cap. ex etc...   

I have a loft down in the financial district that I wish I could rent (rental cap) and I bought that back in June of 2016.

The basis of the property increases 10% of your original gain at the 5 year mark, another 5% at the 7 year mark, and after 10 years the gain is capped off. 

If so, how difficult is it to manage?

Also, as has already been pointed out, 5% is not conservative enough to cover both maintenance and cap ex.

It can be very difficult to find a positive cash flow property in M-town.