Consider it a due diligence expenditure.

Things that I didn't see you put down: Vacancies, capital expenditures, and property management

We have cut our expenditures a lot, and if I try to do any more, my wife may just kill me.  

Also look at what the capital expenditures are, never say none. 

I've set a goal for us to own our first rental 1 year from now, foregoing any crazy expenditures with our own house or health of course.I hope to learn bunch here, and hopefully build some connections with fellow investors here in Indianapolis.

I've used that one for large expenditures I want to spread out over time.

So, figure out what a specific property in a specific area could/should rent for and then figure out if that would cover the expenses.Expenses include property management, taxes, insurance, any owner-covered utilities (ie water, trash, maybe even gas or electric), a vacancy buffer and then some reserves for maintenance and capital expenditures.

You are losing access to that cash that you'd otherwise have available for real estate investment (or something else).If you're ability to invest that cash as a real estate investor is high (10-30%), then this purchase will likely be negative cash flow for you, so again more likely an expense than an investment.Your own mention of this being an emotional decision suggest to me that you know this is a luxury expenditure and not an investment.

I personally use 20% for the type of houses you describe above.In addition, while maintenance costs usually cover routine items, you should probably consider accounting for capital expenditures as well i.e.

I have it worked into my strategy to cover all expenditures, i'm going after the buildings :)