.: Quote from @Jay Hinrichs: Let me break your post into parts, as each concerns a different subject and as such requires a different response.1.

I obviously want to get the best tax benefits and write off the expenses for the house and repairs I have done.

The expensive one MAYBE 7-12, 14 if you take extra good care of of it. 

Your not correct under many different circumstances.First property tax is 1.1% (fairly safe) with 2% annual increase (prop 13).Next expenses include a lot more than property tax and interest. 

In your opion #2, would that require you to rent a home in Seattle?

This is not the cheap markets but the higher cost markets.This year I added a half bathroom out of existing space in a very expensive area. 

In the area I lived the properties were too expensive (Watsonville CA) so I began doing farther searches out of my area.

It's easy to obtain, costs very little, and doesn't require extra, on-going effort to maintain.

If you do it right, it’s arguably the best market to invest.Purchase: $80k-$130kRent: $1100-$1500 (no rent control in MI)1% rule: .9%-1.4% rule dealsCoc ROI: 4-12%Total ROI: 20-40%Cash flow: $50-$250/door (after all expenses and budgeting for maint, capex, vacancy)Appreciation: 3-10%+ (has been double digit for a decade)Location: C+, B-These numbers are based on the “sweet spot” in Metro Detroit.

As others have mentioned, having a good ballpark estimate of rehab costs before closing is also smart, and likely required if using a hard money lender.