Of course, this is a way I have learned to be more efficient with a low income "D" level property.

In the Madison, WI area, I think we've past the bottom and we'll see some improvement in pricing and sales this year. :) More on my thoughts here: http://wp.me/p1dbYY-7V

As Rich pointed out, things change and it's rare that an area actually improves over time if it was a mature area...but there are some, they usually decline.Most who hold SFD rentals I know flip the inventory 7 to 10/12 years staying away from many of these issues.

It seems to me that anyone holding properties long-term would end up with dozens and dozens of depreciation schedules over the years for all sorts of things that would be considered "improvements".

Then hold the lots until things improve.

I can't think of a third but welcome all suggestions and even improvements to my first two offers.1- Seller finance - 0 down for 15 years.2- Work with the bank to assume the loan and pay the seller $5000. 3- ?????

The cash flow purists are going to hunt me down and beat me for this one, but here it goes. 2 years ago I bought a property (foreclosure, on MLS) for 26K, put a ton of money into it but got energy rebates.

Here's a link to the IRS that discusses real estate basis http://www.irs.gov/publications/p551/ar02.html#en_US_2010_publink1000256941Thanks Justin.From their publication, it sounds like you can only add capital improvements to the basis, not things like replacing broken doorknobs, AC handlers, or redoing the floor, etc.I haven't really had to do any capital improvements so far.

I dont think they improve neighborhoods as much as they provide a service for families.

They advertise the houses as being pre-let to section 8 tenants, and are recently painted / improved inside.