And I want to rent out their home to produce cash flow with low interest rate, which they have. 

Not actively looking for properties at the moment, this was in 2021 and we were just trying to buy up as many properties as we could while the rates were low. 

Bought at $126K, as-is value $165K, and updated value $265K - that sounds a very low margin given the risk involved here. curious how it turns out so far 

For example, could this potentially be a cash boom opportunity within the adjacent areas such as Kenosha and Mount Pleasant where one could buy low, sell high within a relatively short amount of time through appreciation, or would the presence of Microsoft increase cash flow in those areas?

He got short term debt and bought at too low of a cap rate and the market shifted; I wasn't too savvy enough at the time to realize the danger. 

The floor has quite a few issues (high points, low points, pitting, flaking over an 8 sq ft area where there was a plumbing leak that they caused, and many sections are still wet even after a week).

Thank you @Michael Smythe Detroit, MI is my last option but within my radar due to my low budget.

Lay low and stay out of the crossfire.

There is an extremely low success rate going this route.

Fixer upper MFH could be low in inventory but normal ones are still there