And lower-priced rentals tend to come with more vacancies, damage, and hassles.If you can stretch to $75-100k, Fresno and Stockton are rising markets with good cap rates.

Stretching this out is only going to cost you thousands in lost income and add a lot of stress to the Tenants while they try to catch up.

It needs a little TLC, but certainly not horrible by any stretch.

Last stretch. 

I agree about reserves and feel uncertain stretching myself so thin.

They were also urinating on the carpets in 4 stair wells and the urine odor was horrible.I knew I could not stop these ghetto people from drinking and urinating on the stairwell  carpets, so the day the property closed escrow I terminated the tenancy for all 14 tenants because I knew some would move in 30 days, some in 60 days and it would take an attorney and 3 to 5 months to get some tenants out.When I started remodeling the property there was so much cockroach crap under kitchen cabinets we literally used a square shovel and a large trash can to remove the dropping (or whatever that crap is called), but the point to my story is; I am never afraid to make start a major storm when it comes to evicting tenants, remodeling and spending tons of cash because I know that when I stretch out the numbers over a 10, 20, and 30-years the profits become amazing.I am guessing that you have purchased a goldmine for $150,000 and you just don't know how to turn the property into what you need it to be.

“So, I’d really like to get this thing for about 35K, but I’d probably be willing to stretch to 40K (40K + 12K repairs + 3K closing/money costs = 55K all in price)...”

So, I'm unsure you are arriving at the $1.1M valuation (if it is just asset valuation; as it doesn't seem like it is cash flow based).I'm not sure how much exact debt you are looking for (if you are refi'ing the partner buyout and want $320k, for the straight cash, or $570k, refi and construction, on top of it), but as most conventional lenders will want at least 1.2 DSCR, the amount you are looking for could be a stretch (as far as DSCR and begin able to service it) based upon current NOI. 

If you had $1M:- Bought 10 $100K homes cash, you might return ~5-7% on your money- Bought 50 $100K homes with leverage (I know 50 homes at 80% LTV is a stretch), you could pull in $120K COC a year at $12%- Use that money to invest BRRRR, you could pull in $200,000+ (infinite returns if you could find all 70% deals.Personally, if someone gave me $1M, I would build a portfolio for myself that generates an initial layer of cash flow, and then invest in into syndication deals (MF, MHP, SS, etc) to be in different markets and asset classes and take my time back immediately as I have a small child at home and want to travel more and show her the world.What is your highest and best use of your time and your investing goals?

Initially the whole deal was going to be completed in six months, but stretched to about 14.