He finds heirs usually are out of state, far away, and often uninterested to take over, so often, he buys at a good price.Now, this is a long game, your involved with the property for long periods, unlike a flip, where you come in, you find a buyer, you're gone.

I have been involved with self directed accounts in a number of ways.

The situations where land and/or vacant buildings were owned prior to 2018 are usually the most complicated and typically involve the a little more tax risk application of the OZ rules.

It sounds from your description that it is.However, because you also do personal activities in the room (play games on your desktop), it doesn't sound like this would pass the "exclusive use" rule.Playing the games on your laptop in a different room would likely qualify the room as "exclusive use" as a home office.Also note that in the future if you take this deduction, there is a simplified method you can use to reduce the records you have to keep - just multiply the square footage of the office by $5 (if it is under 300 total square feet).

I would proceed very cautiously when zoning is involved. 

I deal with the monstrosity known as the NYC building of department as well as smaller municipalities like in my hometown of Yonkers and there is a wide variation on the time involved and what they require.

Proper techniques and caution needs to be applied to this specific method.  

This means that you could qualify with one method without qualifying for the other. 

Then, once each rental is done this way and applied to income or debt, they are going calculate your DTI and qualify or deny you based on the DTI requirements of that particular loan program (28%, 30%, 35%, 40%, 60+% back in 2005, whatever).The above underwriting method is know as "washing" the debt of each rental property with its income.Another way that they do it is they simply take the PITI of each property straight to the debt, and the rental income from each property straight to the income (usually also reduced to 75%); rather than washing it first.It is advantageous to the borrower's qualifications to "wash" the PITI with the rental income and then apply the remainder, whether positive or negative, to income or debt. 

Multiple subcontractors would be involved.