My tenant asked to be let off of his lease 2 months early and I decided that I want to sell the property so I offered them the deal that if they paid 1 of those 2 months (~$1700) and allowed us to start making upgrades to the property, they could be let off of the lease early.

Where it can become really tricky is that I have heard of one instance where the delinquent owners didn't file the exemption then after the sale and 6 month period were able to claim some reason as to why they weren't able to file the exemption and were able to get their property back after improvements were made.The court does require that anyone redeeming a property pay 25% interest on the purchase price plus expenses to maintain and secure the property (not upgrades).

Combined, the offers were $316,500, bringing in $3,800 from the start which we are already upgrading to make that $4,300. 

Without having to spend a dime on any physical upgrades we will drastically turn the NOI around.

For example, the duplex I bought in January has brand new HVAC on both sides and 3 year old roof, and upgrades to interior 3-5 years ago.

It usually happens over the decades when a locality upgrades a computer system and/or they change their parcel number scheme and it slips through the cracks so to speak... or on lots that have been held for a very long time, ie pre-computers... there are these 1/8th, quarter or half lots that are basically not "buildable" on their own... they are thought of as attached to the parcel next to it that usually does have a structure of some kind, but they are taxed separately. 

So a 100 unit apartment will be $25-30k to ensure you have money to fix big ticket items such as roof, HVAC, etc.And I'm not talking about the capex to fix deferred maintenance or to upgrade your property to match the surrounding comps.

Take 1.2M home and invest in some cosmetic upgrades to run the resale up to 1.8M seems to make sense.

In many cases buyers want to do their own updates, so they won't give you anything additional for the "upgrades". 

You can then decide what needs to be repaired/Upgraded up front and what can be deferred.