If they're equal, will there be higher demand in Chicago or Boston in the future?

Nolo.com states the following should be included in a holding deposit agreement: the amount of the holding deposityour name and that of the applicantthe address of the rental propertythe dates you will hold the rental property vacantthe term of the rental agreement or leaseconditions for renting the applicant the available unit—for example, satisfactory references and credit history and full payment of first month’s rent and security depositwhat happens to the holding deposit if the applicant signs the rental agreement or lease—usually, it will be applied to the first month’s rent, andamount of the holding deposit you will keep if the applicant doesn’t sign a rental agreement or lease—for example, an amount equal to the prorated daily rent for each day the rental unit was off the market plus a small charge to cover your inconvenience.Regarding your $200 cancellation fee, I am not certain it would be considered "reasonable" because my understanding is the fee should be actual losses (loss of potential rent, additional marketing costs, etc.).

Now, if any of you have read David Greene’s book on Brrrr investing, you know that he says it is crucial to have a rock star roster.

You can agree to split profit 50/50 even though equity contribution is not equal.

If you painted it right before they moved in I would HIRE a painter and then charge them 40% of the cost (5 - 3 equals 2 which is 20% per year.)For the repairs I hire it out.  

Explaining your plans and knowing what you can afford or if your plan will work, is crucial before you get too far in the process :) 

The time component will be spent on the front end regardless (picking a manager OR building a system... both take an equal amount of time unfortunately, lol)BONUS: Professionals in all businesses are recommended based on perceived experience and tenure...

I know you mentioned using grants for the 20% down.For a 500k home, that leaves 420k to be financed.  420k financed at 30 years is approximately a $2,000 monthly payment (equal to the rent). 

The seller should be happy with this, as 1) they won't pay as much in interest income taxes, and 2) they will receive more money up front and can invest it in higher yielding opportunities than the interest rate on the note.Note that this deal is only good for you if the additional money spent on a higher purchase price is less than or equal to the reduction in interest expense that results from a lower interest rate.

Those tasks are no fun, but crucially important.For some investors, being an agent brings a good source of side income each year.