40k you may find something, anything under 40k and I think you should adjust strategy.ask fellow investors in your town and spend a lot of time talking to local bankers. 

@Matthew Paul I used to be a claims adjuster and would use my estimates to negotiate with contractors.

It does not make adjustments for natural neighborhood breaks.As someone new, the key is to learn the area you want to invest in. 

A traditional adjustable-rate mortgage at prime – 0.75% has a payment of $1,210.It requires a payment of just $918, almost $300 less each month.

It might be easy and adjust down spouts and or grading.  

Scale Adjustment Factor 1 Tear Down -60% 2 Major Repair -35% 3 Significant updates needed -15% 4 Cosmetic updates needed -5% 5 Zillow value - intentionally above average as Zillow factors in "sale ready" condition 0% 6 Major improvements 10% 7 High end value added everything 25%You'll notice that I consider "Zillow value" to be a 5 (greater than average) as my assumption is that most properties that are for sale are also above average outliers (on either side) factor out in to the "noise".Thoughts?

FYI inflation adjusted income increases is the best predictor of both value appreciation and rent appreciation.Check out http://www.city-data.com/ and an inflation calculator to see what that trend is over 15+ years, that way this doesn't happen to you again. 

This also makes it quickly adjustable, and balanceable (I know that's a word because spellchecker found it) almost naturally by those involved with it directly, and naturally balance things by their ability to quickly take advantage of the natural swings of the market. 

Would you adjust your business model to account for the current market environment and disregard the rigidity of tried and true models that currently exist?

No mention at all about how they would adjust their financial and operating model should these activists get their way - and they are a growing lot, a take no prisoners virulent group, very loud, and they want things to change.