You could conceivably avoid paying taxes if the timing is right and you do the repairs and sell quickly. 

Hard to say, but conceivably the dirt olone could be worth $280k with low rents.

The original $105,000 in your scenario above could conceivably get you into 1.5MM in properties.   

I think that's the only way I could conceivably do this (for the time being) but glad to know it's possible if you do some leg work. 

So it's conceivable that you could find a place perfect for you that is less than the property you are selling.I'd then balance my debt so I take more on the primary and use excess cash to pay down or off the new rental. 

If you can conceivably buy with cash and fund the rehab out of pocket, you can refinance right after the rehab at 75% LTV (with some limitations) using a loan under the Fannie Mae Delayed Financing Exception.

Southern Nevada, Arizona, Southern California, Northern Mexico were not expected to be what they are back in the 1930s when the Hoover Dam and accompanying infrastructure were conceived.

If a person can afford to provide a $40,000 20% down payment on a $200,000 house, is it not conceivable that they could afford to provide a $10,000 5% down payment and use the remaining $30,000 to cover the $200 a month ($2,400 a year) negative cash flow?

This area is definitely not as "dangerous" as it was in recent years, but I imagine it would appear too sketchy for many investors.Forest Hills - This has been a "arrived" neighborhood from the day it was conceived. 

This is an incredible source of free information.Also, run a seach here on BP for "favorite books" and you will find threads of people recommending books on every conceivable real estate topic.