It is very hard to generate money with sub-standard real estate in the long run, capex tends to exceed cash flow and you are not creating meaningful equity either.As long as your properties are financed cash flow will be maybe not nothing, but indeed be quite limited.

Also, considering that new propositions may pass that would limit/restrict future increases.Look forward to hearing from landlords, investors, previous/current renters and anyone else to help me determine what to do. 

Is there a W-2 limit or is our CPA not knowledgeable on STR tax???

But you'd always want to talk to the city right away (or county) and find out the development standards for the zoning that the lot is in (what are the setbacks, height limit, min lot size, etc).

Their is risk and like many who posted to me personally my personal homes are off limits to investment debt.

In some markets or some tenant bases they always like to push the limits. 

@Ben Oestrike   Since you've noted this would be a PA Sheriff Sale situation and with my limited experience and @Jay Hinrichs very extensive experience, we've both noted an experienced lender is very unlikely to provide funds for a purchase.   

But, if it's all you know, I guess that limits your perspective somewhat.

Most simply don't have it and or also have very limited sales and closings skills ..

sales commish  loan fees on new loans etc etc.. seems knee jerk to me.. but hey I am not finding those issues with Vegas LOW property taxs some of hte lowest in the country and unlike FLA and TX very low insurance because limited to know real issues with bad @$$ storms like those other states.