Wondering if the proximity to the mid tier city helps any, or if this is too risky. 

Alternatively he could do a live in flip, but flips can be risky and first time flippers don't always profit.Best of luck to you!

I'm assuming you're leaving $50k in the deal ($215k purchase + $30k rehab + $5K closing, minus the $200k loan).So your cash on cash ROI is 2% if managed (and $87 is a risky number -- easy to go into negative territory), 9% if self-managed.

I  still use security deposits and may charge more depending on risk.  I

Risks:The biggest risk is obviously that the dog will destroy my rental.

@Gabriel Harper I think it's a losing proposition unless you charge a significantly higher fee or pay the owner a significantly reduced monthly income.Just off the top of my head, I suspect you would need around 25% of rent income to make it work.

The risk is wayyyy to high for arbitrage right now.

A lender’s risk is mitigated because they loan at a relatively low LTV, to experienced borrowers, and have a mortgage or deed of trust which provides recourse to the property.

So how risky was your first deal?

That is arguably a little more risky, but it works for some people.