But it would need a BPO or appraisal to be certain and a discount would be needed on the UPB.  

The house has now been appraised at $265,000 market value. 1908 sqft. 

I'm eager to start the work of finding a drive-by appraiser and calling title & insurance companies to close this transaction.

Property appraised value increased substantially with improvements and new higher rental tenants

The appraisal came back at $285k.

Memphis investors, is it realistic to expect deals where I can buy a SFH for $100,000, spend $40,000 on renovations, and then have it appraised for $170,000+?

I actually don't know where to start to get an appraisal and I don't know if an appraisal would increase my property taxes.

As for SFR a pre approval letter is of value because most institutional lenders will close the loan with the main qualification being the buyer himself, as long as the property appraises for a certain value.Loans secured by commercial real estate are much more dependent on the property itself and all its characteristics, not just the appraised value.  

Does the appraisal value really matter though if it generates a ton of income?

You cannot finance more than what wouldve been available in the initial purchase or use any improved value or new appraisal to increase the loan amount.