Plus with the amortization dragged out, you are not going to build up much equity in the property.Of course it is possible that some people are simply buying with cash, but without using the leverage of a mortgage, the return on real estate is much lower.

If you have nothing and the property is mortgaged, then you're fine.But if you are worth something, then you become a bigger target and the risk to yourself dramatically increases.Personally speaking, I'd be giving notice that the lease won't be renewed regardless of the person stopping smoking (I simply won't believe them).

If I were you I would be looking for a duplex, triplex, or quad simply because the more bedrooms you have means more rent coming in which means a lower mortgage payment out of pocket.Good luck and I would love to hear how your future turns out !

I do not plan on doing the rehab work myself for these, instead I will use contractors as I will attempt to flip these within a short time frame.

Or would he/she simply be loaning you the money?  

Of course not, people get on BP for what they believe is good knowledge, just like people pay for guru seminars for what they believe is good knowledge.Full disclosure, this is just my opinion, and I am in no way affiliated with any guru, program, scheme, flim-flam, fast one, hosing, con, shakedown, sting, or hustle, I am simply a fan of seeing grown RE investors digress into 12 year old World of Warcraft forum trolls anytime someone mentions a "RE Guru".

Would you simply go somewhere else or just hold and bank on appreciation and paying down loan?

The few that are are simply part of normal RE investing. 

I am able to put up to 25% down (which is what the bank is asking) but the seller is only considering cash offers due to appraisal not going through at the current price in previous deal attempt.

To me it is not worth risking reputation, morals, etc. simply to get a deal.