The scope of your question exceeds my level of expertise, but I am at least acquainted  with the basics of buying rental property, particularly single family houses. This will seem self-serving, but I strongly recommend that you work with a Realtor when looking at rental property. You may want to be the Realtor's client, rather than a mere customer, so that he or she can advise you confidentially about a property.

Aside from feeling confident about the condition of the property, you need to be relatively sure it will generate income for you and not be an albatross. The key concern here is cash flow. That is, how much monthly income will the property generate? You want a positive cash flow, meaning more income than outgo, so you will have a profit.

Figures on paper may look good, but the reality may not be so rosy. Does the property have a good rental history? Does it stay rented most of the time? Are the renters good payers who don't trash your property? If you spend all your profit on repairs and maintenance, what's the point?

Here's an example of a rental house with a good renter and a positive cash flow. This little house is for sale for $28,500. Let's say you buy this house with a down-payment of $3,500 and a bank loan of $25,000. Let's say your annual interest rate is 6.75% and the term of your loan is 15 years. Your monthly payment for principle and interest would be $221.23. The monthly rent from the house is $350.00. That's a positive cash flow of $128.77. That's an income of $1,545 a year. It won't be all profit, however, because you will have expenses for maintenance, repair, insurance and taxes. What if your renter moves out? There goes your income, but your monthly expenses continue.

The bright side of the picture is, in 15 years you will own the house. No more mortgage payments. From then on, your rental income is mostly gravy. What if you own 10 rental houses with positive cash flows? Would that income make your retirement years a little sweeter?

If you are interested in owning rental property, let me know. I will add you to my list of rental property buyers. Yes, there are people who regularly buy rental houses. Don't let them have all the fun.