Are they just rented more often at a lower cost?  

We are looking at building a new team as we need to get our business back in order so we can better protect our assets here in the States and also lower our taxes as we have not focused on this aspect having lives and worked primarily overseas.

There is no state income tax in Texas and property costs are much lower than NY.

As always, there is a lot that goes into these transactions under the surface level.

However, this explains the lower prices for the intimate cabin setting that we are looking for.My investor wants something close to an services and attractions, hence opportunity for vacation rentals, when not used by the primary owner; but, still have the ability to provide a private intimate/eco-friendly setting for those wanting to get a way from it all.

Closing costs: $3515 (3.5% down on FHA)Conventional 30 year @ 3.25%Income: Current rent: Lower 2BD $800 (rented MTM but I think I might be able to get $900)                     Upper 1BD $500 (I would occupy upper)Market Gross rents: $700-1200 2BDMonthly liabilities: Mortgage (P&I): $399Utilities: $150 Vacancy: $65 (5%) CapEx: $65 (5%) Insurance: $90 Repairs: $65 (5%) Property Management: Self managedProperty taxes: $408Total expenses: $1241Monthly cash flow~ $58.64/mo (Unless I can get $900 for rent then it would be ~$145/mo)My current rent is ~$500/mo with utilities.

Curious how the 'mechanics' of a transaction like this work.

Well Chris M. guess with the non-commercial, My gripe is that I would expect to get a lower down payment, but when they classify my property as commercial, that seems to automatically require 20-25% down.Julie Marquez that is good information to think about and I will certainly ask the question next week, if for no other reason than to present as an knowledgable investor.

I would remove the table and add lower cabinets /counter tops along that wall under the window.  

If you think you can still find a quality tenant at 2200 a month and it will not take you more then 1 month to find then advertise it at 2200. if after two weeks you are not getting quality applicants I would lower it.