But there are a variety of ways this could be treated that would change that answer. 

Sounds like the first property is treating you pretty well.Not sure the normal advice of paying down mortgages applies to folks like us that are building RE portfolios.

Overall, treating borrowers with respect and empathy goes a long way in fostering a positive and lasting relationship.

Treat appreciation for what it is: a possible reward for an investment done right."

Maybe we are being forced into a colder world, where people just buy builder grade BS, and things are just treated as roofs over peoples heads, but feel is something human that cannot be taken away, and a good agent understands this and their buyers.

Aren't the taxes for investments treated similarly as primary?

Treat people fairly and go find a new tenant. 

If it is a non-Roth, everything eventually comes out at ordinary income rates, including appreciation which would otherwise be treated under capital gain rules.

They are worth more, you attract better tenants who pay more rent and treat the properties better.We replace 3 or 4 driveways every year.

Since you acquired it so recently from when you will close on the loan (in your case 1 day), certain HML lenders will treat this as a purchase rather than a refinance which offers better terms, more leverage, etc.