However, it is only day 1, so I will have to see how it goes and what other lessons I learn.I did also put together house rules, and go over everything with the tenant upon arrival (I did talk about any "rules" during the final interview to make sure we were both clear on expectations), and provided a written copy.

The appraised value is exactly what I estimated, as well as the market rent and expenses.

Who is actively investing (or hopes to) invest in this market?

Should I use it to build the big house and house hack (probably around 500k) ; or should I just take out enough for a down payment on a new property.

You must work at least 750 hours per year in a qualified RE business.So most people who have high-earning W-2 jobs outside of real estate won't qualify.But the unique thing about RE pro status is that even if you don’t qualify but your spouse does, you can both file jointly and claim the losses from your RE investments to offset your other active income together.It's an incredibly powerful benefit if you do meet the criteria.

Your plans may change and you need the funds to cover that expense.I recommend you consider a house hack right now.

Why come all the way up to Cleveland when Memphis is right there?

What type of deal is it and where? 

With a 30 day trial I would say at least give it a try and see what you think.

What your current take on RE investing across the markets?