Alex -  Construction can be a complicated animal.

So more vacancy + higher turn over costs quickly eats into the C and D returns, often yielding returns only marginally better than A or B assets.  

I’m Also certain you’re the type of landlord who will find every reason to eat up their deposit when they leave. 

(Oz Realty charges a one-month placement fee which does eat into returns over time.

For example, even if you are complying with their criteria, what if they have a road/ROW widening planned in 2 years that nobody knows about that eats up 30' into your property. 

Your brain will eventually tune out the smell after a day or two - not a game changer for most, but the brain eating amoeba in the lake was, and I know many who now swear to never swim/boat/ski there again. 

When a applicant has a service dog or ESA-certified animal, is this considered a red flag? 

Yeah they purposefully didn't check the pet box.I would have done the same as you and changed my description so no one can say this in the future.I also have in my welcome message to Confirm how many people are coming and if they have any animals.

Do you all follow this if you accept both, or just eat the CC fee?

If you want to talk risk, put down the PE talk for a second and look at commercial real estate, inflation, higher defaults, forever wars, growing china dependence and the economy and tell me that real estate would not be effected equally across the entire board when the house of cards fall, yet dividen stocks (this is a fact) tend to out perform the rest of the market due to hardships not really keeping people from drinking coke and eating at fast food chains.