If you have a 1st lien with a low rate and a sizeable balance outstanding on the property, this strategy may not make sense. 

Balancing fatherhood, managing properties, and owning a restaurant is no small feat – kudos to you for juggling all those responsibilities so well.As a property management company, we appreciate the challenges and rewards of this industry.

So your vision of things, is via a lens you pre-selected to see things in, an "evil" intention vs one where they are trying to avoid the size a universal increase would require, the burden upon everyone, and seeking how to achieve same ends but in a more fair and balanced approach. 

The challenge was balancing the renovation budget with market expectations to ensure a strong return.

At this moment, they are a full month behind on rent ($2,245 including the late fee), they are about to have a balance of $4,340 at at the start of August?

We learned that even in fast-moving markets, maintaining a balance between speed and strategic pricing is crucial to maximizing returns.

Property 1: 4/3 LTRCurrent Value: $475kPurchase Price: $363kDown payment: $40k (30 year conventional)Interest Rate: 2.75%Remaining Balance: $294kMortgage payment: $2369AVG revenue: $2775Property 2: Duplex - 3/2 House Airbnb & Detached studio apt 12mo leaseCurrent Value: hopefully within $575k-$600kPurchase Price: $591k (appraised at $599k)Down payment: $30k (30 year FHA)Interest Rate: 6.125%Remaining Balance: $552kMortgage payment: $5041 (including $362 PIM)AVG monthly utilities: $385 (full year avg)AVG monthly revenue: $5261 (full year avg airbnb + $1650/month from apt)

Also, the larger down payment can be the case depending on the remaining mortgage balance vs. the sales price. 

Tax sales are a balancing act among (1) the need of government to collect property taxes and, if owners will not pay then, then to provide incentives for investors to purchase the tax rights and (2) investors, who need an attractive return for the risk they are taking, and (3) citizen taxpayers, who should not lose their property and all equity because of small debts and perhaps temporary or at least relatively short term financial difficulties.

In my market, electric, gas and internet will follow the tenant, meaning when they move out, if there is an outstanding balance, those utilities can't be turned on for them at their new place until their balance is paid.