It's important to understand that real estate is not "passive" investing.

@Paul Bogard going to assume you are buying this proeprty to live in while you "house hack".First, you should understand +95% of real estate agents ONLY know how to sell owner-occupied properties and are almost useless for investors:(Find an agent that has rental properties themself or can PROVE they've got successful repeat investor clients.Secondly, you can greatly improve your cashflow by renting out your other bedrooms.

@Frank Newsome recommend you first understand how the S8 program works!

I understand equity and cash-flow are related, but what I mean is that I don't need the cash flow right now as much as I'd like to build a strong portfolio that can cash flow even more later on.I've owned a single-family rental for 4 years, but on mulitple fronts I felt like I've done a poor job self-managing it, so this Fall I picked up the Turners' book on managing rentals and that's what led me here to Bigger Pockets online.

This log will be invaluable in case of an audit.3.Grouping PropertiesWhile I’m not an expert in international tax law, my understanding is that you can group all your properties together for material participation purposes.

5 percent down, standard 30 year loan How did you add value to the deal?

Nice to meet you Renee,This question is very difficult to answer without understanding end goals. 

From my basic understanding it would make sense to change it to a rental and then do the remodel so I can claim depreciation on my cost, is this correct or not? 

Get a development standards book so you can understand what and why a engineer should do something.

But, understand DSCR loans are only for investment properties, not for a primary home you might want to buy in the future.