I Offered it to them at 10% below market with him paying utilities. he wanted it, so I screened him to verify he can afford it.

Is there a way to utilize part of my Traditional IRA funds as a down payment on a SFH investment property without being penalized?

Utilizing the VA loan is a good first step in terms of investing.

I would count on having at least half market rate tenants, in the event Section 8 rents are higher than market, which they are in our market (granted you will need to subtract the utilities from the rent).  

Replacement homes will be climate hardened, smaller, functional and include consideration for the type of infrastructure, architecture and sustainable/durable materials utilized. 

Now I've got a property under contract:$78K purchase$35K in development of utilities.$24K in soft costs (permits impact fees etc)$200K (or less) buildout of the house (size tbd on after-build-appraisal) Likely going with 2/2 A frame 1000 sf.

WHAT ARE THE DIFFERENT METHODOLOGIES UTILIZED IN A COST SEGREGATION STUDY?

For the LTR, we used(took off market yesterday while trying to decide on the said topic) market it at $2050 with concession of $1000 with all utilities paid for by the tenant.

Quote from @Eamon Conheady: I was purchasing a multi family through an IRA LLC and was utilizing debt to finance it, requiring a non-recourse loan.

Yes we avoid custom work to help keep cost down.