I have a seller interested in financing his house to me but he had one main concern.

Your potential concern is that you're receiving a present interest property for services rendered. 

Is there any diff / benefit in single family vs multi family as it pertains to cost segregation?

Thus, I can understand the concern about too many properties becoming STR.

Please let me know if there are any concerns.

If you are concerned about the PMI fee, you can always make extra payments and REFI once you move out to lower your mortgage. 

Given the volatility of bitcoin I would be concerned about potential collateral calls if we do have a true market correction.

@Jamie Salyer Are you concerned about the talk of a moratorium on STRs in Vail?

NPL's - If house prices start to fall, that can have an impact on NPL's as sellers are not concerned with NPL property values and holding costs, but if housing turns, then holding assets which have out of pocket costs AND are losing value will force them to sell much faster.Seller financing vs. institutional paper?

My main concerns come in the fact that there are very few property management companies up here and market appreciation seems very low in comparison to the more populated areas.