- The percentage difference is the percentage the taxes will go up after you buy it.What do you mean by the property has HVAC AND boilers? 

I have heard comments that homes in TX or GA need a major rehab after 10 years, builders use MDF for trim, pressboard under siding instead of OSB sheeting etc As an investor we buy 1960s homes, they have good bones and are worth an update.

It is hard to beat the appreciation, cashflow, tax benefit and the hedge it provides against inflation. 

Quote from @Joshua Alcantara: Quote from @Peter Walther: I've found many properties with title issues wind up with unpaid property taxes so checking on delinquent taxes, tax deed sales and lands available for taxes might help you identify some.Thanks, Peter, for the info!

Then after the units are stabilized (perhaps with some seasoning), you could get a bank/HML to refi this up for 75%-80% of the ARV.  

Since part of your property is a rental, I believe a portion of your mortgage interest should be a tax deduction unlike your other debt.

But ya have to make some educated prognostications in life.Add this to the information your processing - What your talking about doing is eliminating around $4000 or interest expense (which is deductible anyway so really could be a real impact of eliminating $2800 or so) of debt in exchange for paying over $10K in capital gains tax (don't forget possible state gains tax as well).  

Deduct NEW property taxes after you buyDeduct home insurance costsDeduct maintenance percentage, typically 10%Deduct vacancy+tenant nonperformance percentage(we recommend 5% for Class A, 10% Class B, 20% Class C, good luck with Class D)Deduct whatever dollar/percentage of cashflow you wantNow, what you have left over is the amount for debt service.Enter it into a mortgage calculator, with current interest rate for an investment property, to determine your maximum mortgage amount.Divide the mortgage amount by either 75% or 80%, depending on the required down payment percentage - this is your tentative price to offer.If the property needs repairs, you'll want to deduct 110%-120% of the estimated repairs from this amount.Be sure to also research the ARV and make sure it's 10-20% higher than your tentative purchase price.As long as the ARV checks out, this is the purchase price to offer.It is probably significantly below the asking price.

We are learning as we go here and I am curious on the approach others have used when going for their first property after getting their HELOC set up alongside an LLC and so forth.

I’d fix it up and list it to sell after I’d been there two years to take the gain tax free.