Most lenders do not like these lower property values because they are too risky of an asset class, little return in interest and fees, and long term financing will be an issue as well.

As well as moving from higher cap ex exposure to lower cap ex exposure.Cash flow may go down but when the other components of the IRR go up ( appreciation, depreciation, and amortization of the loan) your IRR goes to the moon and more than offsets any drop in cash flowJust make sure you stress test and can withstand any drop in cash flow.

I’m thinking about going with them as well.

The property management side, realty medics, could use a tune up as well. 3 day notice not posted until the 17th after me hounding them.

Well priced properties still get jumped on pretty quickly - we have a smart pool of local and of out of state investors.

check out Bilco company egress window wells on google, the things are coolhttps://www.bilco.com/category293/Egress_Window_Wells

I feel I need to protect myself and get the property to be owned by an LLC...But I need STEP BY STEP instructions including how to start the LLC. 

This is not to deride a program like AppFolio, which is well-suited to small companies (under 100 units or so).

Plus, you continue to build appreciation through mortgage pay down, as well as market appreciation as well.Timing is up to you… now if your potential new investment will cover the higher interest rates you see today.  

Hopefully, this first investment will launch our journey in real estate.Here are some criteria we have in mind:Not in downtown SacramentoClass C+ or B location, since we will be living in one unit (we just want a safe location)Units with shared walls, not ceilingsSeparately meteredFairly renovated or well-maintained (not a fixer-upper, but if one unit is renovated and the others need some work, we would love the experience of fixing and renovating)Can you think of any other factors we should consider?