It’s nice to know that in practice this is true as well with the larger banks.

They would typically sell for a 5-6% premium at auction, so should I exercise my right of first refusal with the thought that I could re-sell the notes later on if I needed liquidity (and on what market)?

Not having a ton of liquid capital is not always a bad thing, this will mean you will have to learn to be resourceful!

We have come across quite a few in larger markets.

We prefer being on the fringe of a larger city as we really don't understand city people that well and find it harder to determine what features they are wanting in a unit.

Your question needs to be about what properties give you the most profit and not about the insignificant difference concerning the amount of time and labor in regards to larger or smaller properties.As for turnkey properties, that is a huge subject and don't ever trust someone else to do your math or manage your properties.

That being said, a seasoned sponsor may also have scale and relationships that allow for more efficient operations, and therefore actually achieve a higher return than a smaller operator, even with higher fees and earlier/larger access to carried interest. 

The subdivision was being revitalized with newer, larger lots being added adjacent to the property with significant value add to the area expected.

It does make sense, but a recent trend has been that more and more developers of larger housing units have relationships with large capital groups that buy up that inventory as soon as it's built. 

Run the numbers Zack.With $100K you definitely have the liquid for a down payment, as a first time home buyer and investor you'll likely have to put 20% if not more commonly 25$ down.