At a macro level the owner is trading a higher price ($130K over appraisal) for favorable terms to you, the buyer (5% down and not having to quality through a bank). 

As they move up the net worth ladder investors tend to want less headaches and move into higher quality assets where ongoing cash flow is a little less but long term equity growth prospects are high.There is generally not demand for low income areas except for investor buyers searching for yield to deal with a headache versus ultra high quality areas where investors will usually pay  a premium to a seller to own in an area.

They are all in stable neighborhoods composed of primary owner/occupiers in markets with strong 30 year population + job growth forecasts.Sources of risk come from a variety of sources, starting with (1) the market, (2) the property and location, (3) price you pay, (4) management strategy, (5) rental rate you set, (6) rehab budget, (7) service provided to your tenants and how strict you are with them, (8) your ability to attract and retain high quality brokers, leasing agents, inspectors, handyman/contractors/agents, etc, etc., (9) level of investment experience you have, (10) familiarity of the market, etc.As an investor, one of my primary responsibilities is risk management... my ability to fully understand all of the risks that I am taking and put processes/structures in place to minimize or control these risks.And if you are a successful risk manager, i have found that in REI you are able to mitigate the downside and generate returns that ARE NOT commensurate with the risks you are taking and do so by providing a triple win to your investors, your tenants, and yourself!

My current case was with the high-end property, good quality tenants, and a high deposit. 

I’m just starting out in my real estate career and as looking into doing a lease option for one of my properties.From my understanding, rental credits are a big no-no, as it makes the deal a financing agreement with equitable interest.My question is, for those deals where the initial option fee counts toward the purchase price of the house in the end, would that ever be considered a financing agreement since they are pre-paying so to speak?  

If you are afraid to speak to your neighbour put up a fence.

We have some 1031X deals that we are working on as we speak.

Although they seem to be highly recommended here, I have not been able to find any examples at all of anybody having a good experience with their claims process.Does anyone have any recommendations for other Insurance companies, or a broker that I could speak with for insurance in the Kansas City area? 

Strictly speaking, you DO NOT need a syndication.

And DON'T speak to the entry level person.