Otherwise, they have to eat the extra expense just like homeowners do.I would talk to an attorney and your insurance company.

Although insulating the floor is a nice extra, it is not the primary way that cold gets into the house.

Think about all the extra time trouble and cost it takes to turn an ordinary house into a vacation rental...just my two cents though...

One effective strategy to maximize unit potential is to explore opportunities for adding extra units, especially in C-Class properties.

I also agree that RE appreciation is unlikely to match the last dozen years, but you never know.Where I am unsure we agree is that paying $450k to improve the cash flow ~$3k (your numbers but I expect my delta wold be similar meaning both my cash flow estimates would be worse than yours but both would be worse by the same amount not affecting the difference) makes sense especially if the cost of having the extra $450k is only 6% rate which is historically simple to beat via numerous investment options and hopefully no one is investing in RE for an expected of 6%.  

If I sense the buyer is cut from this fabric, I will negotiate extra hard against repairs to the extent they simply walk.

So your saying select No Damage Protection and just submit an extra charge when it's warranted? 

Others investors drive extra ROI by thing like ability to reposition property for greater profitability and or less risk; ability to rehab property at less cost, ability to identify areas where gentrification is likely to occur, etc. 

We have increased our monthly rent to price ratio from your ~0.75% to 1.1% but the leverage ate up all the extra cash flow (even if the total return is likely higher).You could be a cash buyer and go from your one property to 20 and cash flow 20000/mo but you are still having to buy and manage 20 properties.You can do better on the total cash flow in other markets or rougher neighborhoods, but the story is similar: you are getting an extra ~25-35% in income for 20x the hassle.

Insurance is expensive, there is a lot of extra maintenance like painting or electric in common areas that don't apply as much with smaller units.