For estates in excess of $100k they are required to go thru the full probate "Decedent Estate Administration" process. 

Can you increase the rent by the amount you find excessive?

I think the answer is very dependent on your appetite for risk.  

They were supposed to requested written permission to spend anything in excess of $100.00.

America was and is built on small business.. rentals are for when your small business is making excess money and then you invest.. not have limited money and think real estate is going to carry the day.. 

And second I think you need to really characterize your risk/return for both approaches you've outlined and see how that fits your personal appetite for risk.

For how its performing, insurance, and the number of vacancies currently, I think the asking price is pretty excessive.  

I don't do any invoicing, I have no employees so this seems excessive. 

What is not legal in NJ is any form of required prepayment in excess of 1.5 months security.

If the prices are rising beyond the rate of rent increases it is for two reasons either too many novice investors are in the market and overpaying or investors have entered the market looking to park excess cash.