In terms of deciding whether a building is worth buying, it matters absolutely none at all whether you'll be utilizing commercial financing or residential.

If the idea of doing that keeps you up at night, then it's not worth it!

This is my experience from Hurricane Katrina now 13 years ago:Properties in nice neighborhoods were available at hurricane sale prices for cash buyers.Fairly extensive rehab was required but 13 years later those properties are now worth 2 - 3 times purchase + rehab price.Not a get rich quick scheme but for those with cash and patience it was a once in a lifetime (we hope) opportunity.

It the appreciation which I believe is loosing steam worth it in the long run?

Does it require a lot of work on my part to make it worth it for KW, or do investor friendly firms not care so much as long as they're getting a cut of the deal? 

So, you need to make sure that the amount you're able to pull out is worth it to add another 15-18K on the life of your loan.

And when did you realize that it wasn't worth the money anymore?

The rent is nice but I am not sure if it worth it for me any more since I am doing larger deals. 

Is it worth it on a 3-family? 

I do wonder however if it's worth it to go in with an FHA loan with 3.5% down.