If that's the case,  you have locked in a low property tax base, and a fantastic (high paying, easy to find, easy to manage, etc.) tenant profile, which I would not want to loose.

The best option is to demolish the whole place and start over.The condition of the house (which is a term I used loosely here) is our questionable part of this deal.

The discount comes from money loosing its buying power.

Lastly a couple months of vacancy to cover if you loose your tenants.

Ya, i understand that commissions come slower and bigger compared to homes, but i was prepared for that wait, because i am currently living all on my passive income of my current rental portfolio as long as i stay within my means and have a few months worth of living expenses saved away for the times i loose a renter and have a vacancy. 

--- Now if you're trying to refinance and take the cash back out sure it would affect that and you would be on 'pause' from being able to do so, but you wouldn't be loosing $ on this investment, you would still be cash flowing and making a profit.

I will happily guide you but if you getting cold feet it's probably good to back out, I consider my self a pretty smart investor, when it comes to buying income property but when it came to buy my personal home I got blinded by other things and forgot that buying a house is a business transaction that you have to enjoy I didn't loose money but I haven't made a ton, like all other investment

Also, since they are much more loosely regulated, it is easier for a real estate developer to commit fraud and not be detected.So it makes sense to me that there are rules in place to prevent "the average Joe", who probably isn't very sophisticated, from being ripped off.

One of my objectives is to avoid situations where the likelihood of being sued goes up significantly and then the likelihood of loosing is above normal (I realize I can't avoid everything unless I do nothing, think woman with hot coffee and McD's).

Another downside is you loose on the advantages, of the Federal Tax Code, by not closing in the name of a LLC.