Without a thermal barrier (i.e. drywall) or an intumescent coating to counter flame spread, there's little chance it would meet fire code.  3/4", or possibly, 5/8" may well meet fire code requirements - particularly if treated with an intumescent coating.Old victorian wainscotting (not the faux 5/16" modern stuff) is 3/4" to 1" thick and the wood would be much denser that a modern 3/4" board.  

I actually wanted her to be in the house (for security reasons) but she didn't want to be there and it was nerve wracking because she left her jewelry all over her bedroom and I had to be extra careful (especially with bigger groups) so nothing got stolen.

Some people would say these areas in Memphis are good/great areas to live and own Real Estate Investment properties... 38117, 38118, 38115, 38133, 38134.. take a look what's going on in those zip codes. http://www.commercialappeal.com/news/2014/mar/06/one-person-reported-shot-oak-court-mall/ or http://www.commercialappeal.com/news/2014/jan/27/jewelry-story-oak-court-mall-robbed-suspect-appreh/ or @Andy Luck here the article I think you were talking about http://www.myfoxmemphis.com/story/23614652/man-shot-while-renovating-home#axzz2xAuxYA6R or http://www.commercialappeal.com/news/2014/jan/18/wolfchase-shoppers-take-cover-shots-reported/ My point is Crime and Bad People are everywhere, not just any specific locations..

So keep firm on your maximum.I never did like auctions for the aforementioned reason and that sometimes you are bidding against people who do not have the means to buy it, so in my opinion, are just placing more faux bids. 

You can get a credit tenant loan at much higher LTV's from lenders because they see it as less risk.With the seller holding back a second you can get in for not much down.Hit a CAP of 7 to 9 going in and with triple net sit back and collect mailbox money.The downside is rent increases are set in stone and may not rise as fast as inflation diminishing returns.Also you have to pay special attention to the vintage of the lease.Typically they go for 20 to 25 years total.A newly signed lease has more security after the store has been built than a vintage 15 years in.They could decide not to renew and when you rent out to the new tenant as a second or third generational space the price per sq ft will typically be lower.So with 2 million I would do some safe CAP properties and then mix in the distressed multifamily for aggressive growth.

Since it is covered with carpet I would assume it is a somewhat "vintage" wood floor.

To make it even cleaner, have them deed the collateral (car, other house, jewelry, etc) into your friend’s name (as long as you trust them) and let your friend give you the payments.

Not any MF apartments, but selective growth markets with solid relative value add opportunities to makeover of vintage 1980s properties, bring in more efficient property management team, essentially re-positioning the asset to make it more attractive to existing and prospective renters.  

But these are the same vintage houses that get similar rents as East Central.  

Some tenants who like those are jewelry stores, photo store type place, postal type places, restaurants/bars with a prohibition type theme.You need to compare the rent bank is paying with current market rents to see if rent is at,above, or below current market.