If the unit is damaged because the leak was allowed to continue, I would charge the tenant for the additional repairs required.If tenants have such obvious lease violations, there is a high risk of additional problems down the road.

Oakland is gentrifying and rent control or liberal politics (like 'em or hate 'em) won't stop that trend...it's just a matter who's making the money.I hear what the out of state crowd is saying, but (caution - incoming anecdotal evidence) my buddy has bought other people's midwest fix and flips with no chance for forced appreciation (in fact the building depreciates over time as housing values remain flat factoring inflation), Lower Cap rate and greater risk than I experienced house hacking. 

There are some things to like, and some obvious risks to not like also. 

Again, I check rental history and I might ask for extra deposit money to mitigate my risk. 

I am aware of the risk of the loan being called as a result.

Any strategy that you apply in RE carries risk.

The numbers are ok, but not so good that I'd sign up for this much risk (rehab costs, zoning).  

Also remember Warren Buffett's observation that risk comes from not knowing what you are doing.

At the risk of sounding stupid what is the secondary market?

@Nidhi SinghMy risk tolerance level would say, yes, get some experience before doing that.Things inevitably go unexpected and what do new people often do when things go unexpectedly?