Is this is still a deal or would it better to walk away?

Money person can take a walk if this isn't acceptable, which shows their hand if they walk, its good news actually.- Cash flow and equity split is 50/50 as well as tax implications via K-1s from the 1065 partnership return. 

It was really hard walking away from this neighborhood but we're hoping it was for the best!

Maybe start a little higher if you have the time and walk the price down if it doesn't get rented. 

I will appreciate any guidance on if this is reasonable or I need to negotiate or walk.

If I were the seller, I would assume you were taking the 23 year old HVAC and water heater into account when we settled at 70, and I would consider it bad faith for wanting to go to 65 and I would walk on the deal. 

Worse that can happen is that I spend a few weeks and walk away empty handed.

The numbers are a good start until you actually walk the property and or inspect.  

He told me that he is going to sell his current house to an investor because he didn't want the hassle of having to walk people through the house and deal with "tire-kickers." 

I'd probably walk just based on the seller already showing tude this early in the process.