Modern, direct vented, natural gas and propane furnaces are typically in the range of 92 - 95% efficient.Your decision on whether to replace the furnace will depend on the efficiency of the current unit and whether it make more business sense to replace the furnace or to add a heat-pump with an exchanger insert to the existing system ... and, it is (or should be) primarily a mathematical decision yielding which ever approach is going to offer the shorter payback and lower operating costs.The math aside, there will be other non-math factors.  

But we know how this can end if prices start to trend lower.

And for the wholesalers out there, we unfortunately turn clients away from many deals because they're too tight (even with our lower end pricing).

@Scott L. and @Carl Fischer, unfortunately simply 1031ing and buying in a state with a lower tax will not help @Ouman You as long as he lives in CA. 

I also have a tenant in one of my lower end rentals that consistently pays almost one month late.

@Irina BelkoferI’m not investing in California, I’ll be investing in lower valued housing around the 50k range in other areas.

IF you overpay a little on a buy and hold, the return might be a little lower, but over time you will pay down the mortgage, rents will go up and you will have capital appreciation. 

So if he wanted to make more money off the deal he'd need to negotiate a lower price with the Seller.

The price has been lowered $5k, and it's pushing mid-September.

The rate is lower if you will be living in one of the units.Hope that helps, best of luck!