Here’s why lease options are a game-changer:🔹 Low Risk, High Leverage – Instead of buying a property outright, you lease it with the option to purchase later.

Determine cost to renovate. 

I'm looking for super low cost, or preferably free.

Though I am unsure how I would amortize the up front remodeling costs for P&L, tax accounting.2) Interest only loans term loans -  Would allow current owner to have cash flow on the property, without eroding the asset value. 

Can try to reposition to Class B, but neighborhood may impede these efforts.Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years.

I know a cost segregation study would be too expensive for such a small amount of property, but is it permissible for me to estimate the value of the components on my own?

This is pretty clean.Scenario 2:  Your partner has owned the house for 15 years and has been taking accelerated depreciation, so the book value of the house is very low. 

It's no different than investors buying and negotiating low prices on distressed opportunities.

We feared it was too low, but we were not willing to accept anything more and left it in Gods hands.

I do see the point @Steve K. and others are making about the annual turnover and low monthly rent being in conflict.