Is there any downside to this type of a deal for a seller?

Agree with others that the upsides are more than the downsides, take the money. 

I will be able to walk away with a little over 215k.The Downside: 0ver 200k cash in my poket in a few years sounds good, Im happy that im in a situation to be able to do this.

The only downside would be in an economic slowdown the cheaper home is probably easier to rent out.

Only downside is you have to drive a minivan :-(

This, combined with the lower upfront and ongoing costs, can lead to a higher return on investment.Of course, there are some potential downsides to investing in mobile homes as well.

What are the down sides of that?

There are a lot of renters and safe, clean rentals in the 750-950ish range go fast.That being said the biggest downside I think to Memphis from a long distance perspective (like me) and like you would be is the general lack of quality larger multifamily.

The downside is that you lose the economies of scale of a larger property so your expense ratio tends to be higher unless you are good with being very hands-on.

Curious what the main downsides are vs. investing in Washington and whether or not there are mitigation strategies?