The only reason I would ever recommend paying market value for property is if a HOT appreciating market was calculated to hit that precise area within the very near future.

If you meet those criteria, you will have sufficient financial margin to make a profit even if the market tanks (in fact, that is precisely how I reverse engineer what a great deal is).

I didn't realize it would be illegal (or morally questionable) to do this, which is precisely why I raised the question here before acting.

The only reason Im saying that is dont try to calculate with so much precision your cap ex dollar amount because thats going to be a lot of times off. 

@Dolly CaswellThere are no IRS regulations or specific case law rulings that get to the detail of what precisely one may or may not do.  

If you knew precisely the problems and scenarios that you wished to solve, you could mail a small number of letters to a highly targeted list.

The consequence of that might be precisely what you’re looking to avoid.

I expect these properties to hold up fine should a downturn occur and then can pivot as the overall market moves.I personally feel that diversification and the ride it out strategy is middle class baloney that knowledgeable active investors on BP do not have to precisely follow because they mitigate risk in certain asset classes with knowledge.  

My point precisely.  

@Hem Kumar Thank you for asking these questions - I have precisely the same ones.