S.F. is a prime, internationally recognized location.

@Jon Schwartz1) To begin with 3 million FMV in California captures innumerable small business owners standing entirely on its own, but if that weren't bad enough, the valuation standard is actually aggregated across all properties owned so it's not in fact in excess of 3 million per property making it much worse still.2) Commercial properties have a very suspiciously expansive scope in the initiative (the devil is in the details, as is typical, and here as well) thus capturing both mom and pop businesses and in many cases even agriculture.3) Unsurprisingly those proffering the provision have acknowledged it is but a first step, once they get their foot in the door with passage of the initiative they will shoot for full repeal of Prop 13 targeting all real estate owners.4) But you make a really great point, sell it as tax on fat cats (while in reality it's scope will hit many many small businesses) makes it palatable to a largely uninformed electorate and further softens them up for delivery of the really big hammer when they shoot for full repeal of Prop 13.

Are there any Texas specific laws we should be aware of besides tht standard non-descrimination laws?

If they're not looking to sell the note on the secondary market, but rather hold it internally, they will have a lot more autonomy than a standard mortgage broker or a big bank. 

@Geo CruzBased off information given, if you pay anywhere close to market value there is zero percent chance that property will cashflow as a standard rental.

as i understand it, you use a standard purchase agreement.

It's a standard TX Association of Realtors residential lease. 

I do not know if that is standard around the country or is a state by state situation, but I just wanted to hear from you wonderful people about what you know about the subject of how taxes change when you own multiple properties (or if he didn't know what he was talking about). 

After purchasing a property it's my understanding standard homeowner insurance is not sufficient to cover a landlord in terms of liability. 

Vermin issues can be extremely destructive both externally and internally.