Mortgages at 70% LTV are incredibly safe in most instances. 

For instance, if you're doing a replumb of a bathroom, you'll need to get a licensed plumber to pull the permit from the city.

Yes - there may be an instance if the distribution is above the partner's basis - that he may need to report additional income.

In your example for instance it doesn't work because you need both purchases (and probably one more) in the 1031so you can meet the reinvestment requirements. 

For instance, do a 15 year projection of rents (say increasing 3% per year) and Expense Increases (say 5% per year) and you will also understand your Cash Flow Growth.Let's say you are collecting $2k per month in Rent or $24,000 per year.Let's say you are paying $500 per month in expenses or $6k per year.Year 1)New Rent = $24k x 1.03 = $24,720New Expenses = $6k x 1.05 = $6,300NET is an INCREASE in Cash Flow by $720 minus $300 = $420 per year.Funny how if your expenses are increasing more than your rents you actually still increase your cash flow.Simple calculations but it tells a lot.There are more to RE than just Cash Flow......

In that instance 80% is allocated to investment and 20% to primary. 

What sort of arrangement would you work out in this instance?

I have had two instances recently that after a non-response from the listing agent they come back 3 weeks later after their other offer falls through and determine if you are still interested.

For instance, there is no sustainable economic phenomenon that can prop up this economy or real estate market, right?

It's just a quick rule of thumb where you see if the total rent measures up to at least 1% of the purchase price.So, for instance, on a 200k property, you should be looking for at least 2000$ rent/month, otherwise, it's not that great a deal.