It needs electrical, some mechanicals, windows, foundation work (including window well replacement, some drywall replacement and the typical bath and kitchen guts.

It is a hard money foreclosure already gutted with Demo, Framing, Mechanical, Electrical and Plumbing done.

I get the basic mechanics. 

That may intel a lot of mechanical changes in the property since commercial spaces have different code requirements.Without changing any use, you can make those rooms into storage units for tenants and charge additional fee for them.Cheers, Yuriy 

MEP (Mechanical, Electric, Plumbing) trade work.

In many cases I think the financial upside with STRs can justify increased tenant-screening costs, and potentially even some revenue-sharing mechanisms with neighbors.In some areas, the government collects a tourism tax from guests, mitigating strain on local resources.

Maybe it's a gut feeling or inner defense mechanism but I don't know how some of these people are affording these homes.

The mechanics of the 1031 are no big deal - I’ve done similar. 

Mechanical is typically where the hidden problems are: HVAC, water heater, leaky plumbing, bad/outdated electrical, roof and windows.During renovations, you follow the same process regardless of the size of the property.

So I'm 22 years old, just graduated college with a degree in Mechanical Engineering, and looking to get into real estate investing.