This area has virtually zero vacancy but its a depressed small town with ceiling on house value. 

I definitely see this building appreciating well especially from the depressed market.

If you're buying with depressed rents and looking to do some cosmetic updates and get market rate rents, there is a good chance that current and paying tenants will balk at the new rental price.

The difference between a Recession & a Economic Depression, is the unemployment rate, for one point for said differences.

Do lenders reduce the LTV percentage in a depressed economy?

You're also dealing with guys that are severely depressed.

This in turn will could flood the market with properties, and perhaps depress the price points of rents as high quality tenants become harder do find.

This is a heavily economy focused government in power that has openly questioned whether it's worth going into a great depression to save the over 65's and immuno compromised, but it could get really ugly if by this cycle of the mutation it starts sending more and more 18-49's into ICU. 

Looking primarily cash flow as there isn't a whole lot of appreciation in our area as we are in a pretty economically depressed area without a whole lot of upside in the near future.  

The problem with Houston, Dallas and Austin is that TX has some of the highest property taxes and insurance rates in the nation which significantly depresses cash flow.