If I understand correctly your siblings goals are to sell their rental properties, use the funds to purchase a primary residence they'll eventually move into, and limit their tax liability correct?

SFHs are largely exempt from many regulations such as rent control.

I might try the “emergency service” which is $20 with limited data and just use that for the smart locks and ring cameras.

Off grid sounds cool to some, but it really limits your potential guest pool.

So my limited experience with a new build did not yield cap ex expenses with what you are proposing. 

If you were limited in cash reserves atleast you'll have the HELOC as a 2nd or 3rd back up source of funds to weather storms.

Our manager also helped and encouraged us to limit our repairs/spending based on the area we are in and the type of property.

So, if your current rent roll is still on the lower side, it could limit the amount you can borrow right now.However, if you have even a partial track record showing improvements.. say a few of the units are already updated and attracting higher rents.. a lender might take that into consideration when underwriting.

Better financing, more control, don't need as much down, etc.  

For added liability protection, consider setting up an LLC for the rental, though this may have limited impact if the mortgage is in your name.This post does not create a CPA-Client relationship.