Have a mechanic friend who is looking to buy a shop.

This is an example of why cash reserves are a very important part of your investment plans.Home Depot offers a project loan that will be good for a lot of materials and some installation of things like flooring, doors, blinds, HVAC or other mechanicals.  

If people want to change the law, go ahead.I once got into a discussion with a local gentleman at the mechanic.

Same impact, same mechanism of syndication  and same qualification for 1031 treatment.  

On the legal side of things, make sure that you get material waivers and gc sworn statements from your contractor's to protect yourself from Mechanic's/Material-man's Liens...

I'm a 26yo mechanical engineer working in NYC and living on Long Island.

It all gets stripped to the outer walls, mechanicals replaced, and upgraded anyway.About the only things we consider to add structural value to a "distressed" SFR is the remaining roof life, HVAC upgrade (gas instead of oil, central air instead of window units), high ceilings (of the lack of low ceilings), replacement windows, and actual above grade square footage.  

I hear people say it all the time, but what are the mechanics?

You want to purchase and own the materials yourself, even if you have to go with the contractor/sub to do so, and it may be a pain, but having rightful ownership will at least mitigate any future disputes that may arise.On the same note in CA, and likely in most states, any contractor can put a Mechanics Lien on your property's title pretty much at will.

The potential for overhead leaks increases the more mechanical joints you have.One way to minimize that is to not have any joints at all in the attic.