Add another $20 a month for that.Add in HOA fees ($300 a month; shown in your link), Gas, electricity, high-speed internet, water, trash and snow removal. 

When she started to remodel, she realized the electricity needed to be updated and the current landlord didn't have the funds to cover.

I would get a professional opinion from a qualified contractor , you may have storm damage already that could possibly be covered by your insurance 

This should be evaluated further by a roofing contractor or licensed general contractor to ensure there is no hidden damage and to make repairs as needed."2.

You trick yourself into believing that the old house just has some quirks that need some love, but then after a full rehab, the electrical concerns were reprimanded.

I am local in Arlington and do pay significantly less than $200/pier but I have developed a strong relationship with my foundation contractor and give him multiple jobs a year. 

IF you wanted to buy properties on the cheap AND do the work yourself (instead of hiring a contractor), then you want to buy with HML, do the renovations, then do a cash out refi and move into it.

I'm trying to plan this out as well as possible to avoid any issues down the road.I've seen the stories where people run into issues meeting this requirement and get scrutiny from the IRS, to me it seems the two biggest red flags might be when they hire a property manager and also when they rarely go out to the property to work on it themselves, always relying on contractors.

If you don't have it you can call your insurance company and ask them to email you the declarations pageRecent Mortgage Statement:2 Different Utility Bills: Gas, Electric, Cell Phone Bill, Cable, Garbage, any two utility bills.Copy of Mortgage Note all pages: Was included in your closing documents when you purchased the home.

She will either take you seriously and move out, or she will show up in court with no defensible position and be forced out.The lease says she is responsible for electricity, but the former owner and property manager sets a precedent by paying it.