The goal is to have this home pay for itself and eventually be able to retire to this house full time in about 10-12 years down the line.

If I sell for $250K, how does that get divvied up between profit and paying off the mortgage I took out? 

No buyer is going to come in and be willing to pay an assessment unless they are getting a deal on the unit. 

I spoke with them, and it seems like you are paying them 1% to help you go through the process... that's about it.

As long as the city does not hammer the builder with connection fees  ( or waives them would be best) I can see this working well as long as folks will pay that much to live there and of course Schools will dictate how well it will do long run.  

Seller has no money to pay utilities or buy groceries.

Now you need to figure out how to find deals and pay for them.

Essentially, the buyer wants to pay my equity out of the property at lease signing then have a option to buy the property after 3 years.

I've studied various strategies, but I found that the guru made it seem like I wouldn't succeed without paying a significant sum for his program, which didn't resonate with me.

As soon as a tenant gets behind on rent, enforce the lease strictly by sending proper notice to pay. 4.