Gambling with someone else's mortgage is not something to mess around with. 

My rational is this:As a REI, I am very comfortable gambling on the future, after all, it's what you do.

Option 1 is just gambling on appreciation and sounds like it doesn’t fit with your long term goals. 

If you buy the property with tenants already living there, you are gambling as to whether or not they are good tenants.

I've been surprised way too many times with major things wrong....unless the house was an absolute steal and then it might be worth the gamble.

Are there any offshore angles:- Is there potential for overseas sales or operations?

but that's what it is, everyone is beaten to death on the cash flow is everything and appreciation is gambling.. so they really do it to themselves.. and have no one to blame but themselves..  

Your gamble (and your ever-trusting Dad's) paid off.  

Still, that is just gambling with the law. 

You can definitely find a deal during an auction but it's a huge gamble since you don't know what the condition of the property is.