You want to ensure that your lender is doing their upfront due diligence on the deal, has programs to get the deal done if the final numbers come in different(low DSCR requirements, favorable rent guidelines, etc), and is offering you excellent customer service.

The other reason is that tax assessors may use different methodologies to value the property including revenue potential.The key items that play a role in the valuation of commercial real estate property include:Property Type: A storefront is for example taxed differently than an office building.Location: Rural regions tend to be taxed at a lower rate than urban regions.Government Spending: When there are different funding needs, it can determine how much of that revenue comes from taxes.Market Shift: When the market shifts, property values change which can lead to a change in the assessed value.Let’s talk a bit more in depth about how the commercial property values are determined.

The difference is you have the risk concentrated on a very small sample size.

There are IRS tests determining who is a 1099 vs W2 and then you have your state specific Department of Workers Comp that will have their own definitions of who is an employee and when you would be required to carry Work Comp insurance.To complicate matters there are a few states where the State itself maintains a monopoly on providing Work Comp insurance and the state is the only place to buy work comp (my state is one of those so I can't even sell myself work comp insurance if I wanted to).Here is an article on the three different methodologies the IRS may use to classify someone as W2 vs 1099.https://www.everee.com/blog/irs-independent-contractor-test/If you are really in doubt call your state's work comp office and ask who they define as an employee. 

But the significant difference in the quote compared to Proper's (200% more) makes me nervous I'm missing something.  

I'm getting started in the real estate investing world and am almost ready to buy my first rental.I’m debating between two different investment strategies and would love to hear advice from experienced investors here.Would you a) buy a two unit and house hack with 5% down (all cash in around 40k) in an appreciating area with a little bit of cash flow every month or b) start BRRRR strategy right away out-of-state in a C neighborhood.And a third option, if you have the ability to do both concurrently, which one would you start with first?

Read the book the 16% Solution to get the beginning basics.Attend sales, network with people at the sales.If the countries around you give a basics class before the sale, attend those.Read your state law several times and again 1 or 2x a year as you will see something different each time you read and as you gain experience.https://leginfo.legislature.ca...See if the counties you have interest in have websites like this...https://www.solanocounty.com/d...I always say be very very careful with the national road show classes that come thru with a free 2-3 hour seminar and then 3 day training. 

However, time in the market makes all the difference in the world!

I am aware of seller financing and am working on that, but I was curious to know if anyone has taken a different creative route that I am not thinking of.

My primary focus is beginning wholesaling to ensure capital for other investment opportunities.