If you choose to do the renovation or remodel the basement, find out what the code is for the work including any egress windows or exits, to be done, pull the permits and do the work. or hire it out. 

IRC § 1031 even addresses properties held for fewer than two years (only the periods during which the property was held are taken into account, unless it looks as though an individual is deliberately trying to “avoid the purpose” behind the code).The safe harbor, essentially, is something like that IF…1.

I want to automate the showing process, by having prospects registering (sending maybe a copy of the DL) and providing them a unique code within a specific time window to go and see the property. 

Here is what I would do.1) Ask to purchase the home owner finance from the owner as is.  2) If he says no, report the home to code enforcement and get it condemned.3) Once condemened, go back to #1.

He even measured the railing on the balcony and discovered it was not up to code.

Denial  there was 60k of code violations as well I could have got those negotiated down to 10k or so.. but the seller would not cooperate so that money came out of her proceeds as well.. 

Ensure it is up to code.

I tried looking on Redfin for comps but I wasn't seeing any multis in that zip code.

The garage was converted and added to the living room/dining room area with a separate laundry room and all done to code. 

I just wanted to make sure that you don't just pass on deals because you're sitting behind a laptop and only going after the deals that have the right numbers, because i can almost guarantee that you won't find it Cheers