The only problem with buying new and renting is you usually can't get a loan that has a mortgage low enough that will allow for cash flow.

The Book on Investing in Real Estate with No (and low) Money Down by Brandon Turner. 

They are on the low end of structuring what you can and cant do, mainly wanting to keep a clean, nice neighborhood (all single family communities).

The rental income is too low for the purchase price. 

Is 250k to low for a good neighborhood?

Heck, I used to go to lowes and home depot in the am.

The commissions aren’t nearly as much in leasing as selling, but if you lowed them, no one would show your house.  

Could someone please help me understand why the ROI is so low?

Once all the updates are done, maintaining the rental should have low overheard for years. and I would show about a $3000 cash flow a year. 

The next time some non-landlord posts in this forum about how bad low-income -housing fixer slumlords should feel for taking advantage of our C/D-class tenants, I'm going to try not to jump down their throat, but no promises.