Then the proportion of your differed taxes/depreciation payback is based on the ratio of years you live there compared to the 2 year requirement (as income property).

I'll add that the risk one's willing to take on should be proportional to how much potential profit there is.Even in your situation where you're just learning, it might make sense to take on a huge project.

But if you want to cover it, you'll need to need to plan on 3" for the concrete slab and 4-6" for compacted gravel/sand under the slab.

And mass foreclosures are unlikely, IMO, except if the private market, which is a relatively small proportion of the overall mortgage loan market. 

There are Qualified Mortgage (QM) rules that are required to follow, basically banks can not charge you high fees in proportion to your loan size.  

From what I have seen its roughly proportional to consumption.

Does there seem to be a large proportion of mult-family housing in any particular areas?

Proportionally your closing costs are always going to be higher on smaller loans.

The assumption is that appreciation is proportional to the asset value so paying more for new only hurts cash flow.

So, the only way to get out ahead is if your property decreases relative to the other properties in the neighborhood.If the assessed value is “dragging,” it’s just the tax assessor not spending time to yearly adjust the municipality proportionally every year and/or a re-assessment (which costs money to do) hasn’t been done in a while.As long as it’s consistent, then I see it as a “fair tax” in my opinion and don’t lose sleep over it.