However,  his asking price is $445K, and after some market analysis and reverse cap rate analysis,  I'm inclined to think it's worth around $390K/$400K. 

The BIG feature of FHA is that's a  program with standard terms and conditions, and that makes it easy for a lender to sell it individually or as part of a portfolio to some other institution. 

A few properties I ran are showing cap rates above 15% even with high maintenance and repair budgets and the taxes. 

NO house here sells for under 100% of value unless its a hoarder house or basically destroyed... what I find in your market is apprasials are pretty much meaningless.. the homes in the rentals areas are sold on GRM or acceptable cap rate or 1% rule pricing... not retail pricing were the ARV's come from. 

Rip it out... in-ground pool, selling feature...Some people don't want houses with pools, others do.

Get a check from the refinancing for $50,000 and roll that into doing the same thing with another property.Now once the house is renovated and refinanced I figure rent being around $1,200 a month, $600 going towards cap ex. and the mortgage costing anywhere from $250-$400 per month and the property cash flowing anywhere from $200-$400 per month.Am I way out of my league with this or does this sound plausible if not common in real estate investing?

Apart from finding high cap rates and being okay with being in debt up to your eyeballs, are there any other methods of growing quickly?

That does not necessarily mean high end features.

What I discovered is something I have never seen anyone speak about on Bigger Pockets (I am sure someone has discussed this I just have not seen this idea discussed at all...or anywhere in my short research period on cash flow and real estate properties.We hear everyone speak about Cash Flow, NOI, Cap Rate or Cash on Cash returns.. however I think there is another important benchmark for investors to consider when deciding their down payment percentage and financing levels because of their effects on cash flow...Capital Cost per $1 of Cash FlowOne of the most illuminating aspects of real estate investing is financing isn’t bad...Having spent all of my life not accumulating debt this has been a difficult psychological barrier to break through.

I'd suggest running two sets of numbers; one for the main building, and one for the garage unit - cap ex and all.