Also, what has been others' success rate with offers similar to this scenario?

Possibly a rent to own scenario.

I am just playing scenarios.

Is this a common thing?

@Steve Hall I’m hesitating because I don’t know what the worst case scenario for s foundation issue like this would cost and I want to be able to allocate my savings towards health insurance/gearing up for my 2nd investment property, not recycling it back into this one.

There is a common misconception about what cap rates are and what their relevance is to a given asset.

What "reasonable" is, is a big can of worms you should discuss with your accountant.It's common to separate ownership of an operating business (the short-term rental business) from ownership of the real estate, so that makes sense, and it also makes sense when discussing mortgage applications.

Does this seem crazy or is this common?

Research the area, look at reviews, called several property managers, give them some common situations that occur to see how they would handle that personally, made sure they were familiar and had knowledge about the market they are managing in.

They're not that common here either and I wish you'd be quiet about them!