Seller property had patio and Jacuzzi permit but during the sale process utility lines  was found and cause title issues.

If a note alone is enough for you to repossess a home, then why do people record mortgages for ordinary real estate?

Flipping homes that rises to the level of a trade or business is subject to ordinary income tax rates, and the flipped homes are treated as inventory, so that portion of your business can be considered a "dealer".Rental real estate is not, however.

I drove by the other day and noticed their patio furniture was still there, so I assume furniture is on the inside as well. 

That’s a huge difference and these higher priced properties take more time to sell under ordinary circumstances

The driveway has settled 6 inches and the back patio (10x10ft of concrete) is completely destroyed (split into 4 pieces) from settling.

The Rentals are generating passive income not subject to SE tax, the Flips will generate Ordinary income subject to SE tax. 

New countertops, floor in bathroom, kitchen sink, added microwave. getting rid of old deck and making patio, closed fence in.

We added a patio slider door and created a deck, I always like to do this because it is relatively inexpensive, however is a great selling feature.

When he sees that, he'll start siphoning off from his ordinary paycheck to invest in your next collaborative venture which will make both of your lives better.