I have ensured smoke alarms and carbon monoxide alarms are good.

I have ensured smoke alarms and carbon monoxide alarms are good.

I'm all about scale, but you need to stress test your situation and ensure you can handle a few bumps that inevitably will arise in this line of work. 

How would you ensure he gets his money back and then some while continuing to invest?

As a frame of reference, here's a rent-o-meter analysis of each unit type:1-bed = https://www.rentometer.com/analysis/1-bed/2411-s-shelby-st-louisville-kentucky-40217/fmnKYxxNACY2-bed = https://www.rentometer.com/analysis/2-bed/2411-s-shelby-st-louisville-kentucky-40217/owLPsrSO2IcTo be safe, I would always assume the median if not slightly below to ensure you're able to rent the units out quickly.

When I say you could 'potentially' save money, it all depends on what you're doing and what you do for income - a universal truth is that you're trading time for money with PM and remember it goes BOTH ways so if you're saving money by not using a PM (again, nothing wrong with that) expect to spend a lot more time on ensuring your rental is running property likewise, if you're hiring a PM expect to have a lot more time on your hands to pursue other investments and focus on making more $$$. 

Check with a CPA to ensure it'll check the right IRS boxes too.Many/most banks will not allow the mortgage loan originator to also be the Realtor very specifically to prevent these types of games.

Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.Don't buy in the roughest neighborhood in the urban core.

Analyzing appropriately will ensure you make the best possible investment.

Note, I'm not an attorney and none of it is a legal advice.3) Discuss with your chosen attorney various "what if clauses" (Things like, what if someone decides to leave, die, becomes incapacitated, and so forth. ) Ideally you'd want to cover as many of these in the OA as possible.4) Outsource bookkeeping to ensure there's full transparency and no questions raised about it. 5) Take action!