If you feel like you have to settle for an undesirable area because of the high prices then maybe save up for another year.

I will be actually heading over to Lincolnton today to pick up my lawn mower from a shop over that way so I would be happy to drive by the house and see if it doesn't have any other undesirable qualities that we can not see.

Clearly, this might be slightly higher than some very undesirable places but I am looking to be close to a subway line and not too far from manhattan.

OTOH, if they're building undesirable apartment buildings, or something that's going to create a lot of traffic and congestion it may have a negative effect.You should look into 1031 exchanges.  

If you were to market, I'd choose a peripheral market that will still have a tourism draw (Ocean City, Brigantine, Avalon, etc).

If the tenant is a D class tenant that is undesirable and I think I want to move them out, then I am not going to show a lot of rent increases from year one to year two, because I know once I start enforcing the rules, these people are going to leave and I am going to have vacancies and have to clean up those units and bring new people in.

It's easier on small or 'undesirable' or harder-to-manage properties.

Flooring over 5 years. etc.Here is a chart of such items.Type of PropertyGeneral Depreciation SystemComputers and their peripheral equipment5 yearsOffice machinery, such as: Typewriters Calculators Copiers5 yearsAutomobiles5 yearsLight trucks5 yearsAppliances, such as: Stoves Refrigerators5 yearsCarpets5 yearsFurniture used in rental property5 yearsOffice furniture and equipment, such as: Desks Files7 yearsAny property that does not have a class life and that has not been designated by law as being in any other class7 yearsRoads15 yearsShrubbery15 yearsFences15 yearsResidential rental property (buildings or structures) and structural components such as furnaces, waterpipes, venting, etc.27.5 yearsAdditions and improvements, such as a new roofThe same recovery period as that of the property to which the addition or improvement is made, determined as if the property were placed in service at the same time as the addition or improvement.Property taxes go on Schedule A.

Get that money, evict them, lick your wounds and pick better quality tenants next time, and/or sell this property because it sounds like it's a very undesirable part of the market where you get poor quality tenants.

I recommended actively changing the environment around him, which he isn't the rightful owner of, to effectively make the shed an undesirable residence.