@Beth Chang this is definitely a HOA issue and should be repaired by them.

I thought about using a release agreement and charging the Buyer for me to release the property to them considering my efforts in negotiating the on the home, locating the property and any repairs I may need to make to help the property p*** inspection for FHA loan.

Are you sure they mean asking price and not ARV (After Repair Value)?

The in-place rents for the cash outlay are pretty low, but that's all relative...the repairs seem excessive...assuming an ARV of $650k and cash out at 70% LTV lands all of your cash back in hand if you do not do the reno...use delayed financing. $525k all in with ARV of $650k changes things quite a bit...you can't pull all your cash back out, but getting $350k back may work...What is your possible appraised value as-is? 

You have to depreciate cap ex as separate asset over 27.5.If your expense is below 2500, you can expense it.If your entire cap ex plus repair for the year is below 2% of your adjusted basis maxed at10k, you can  expense it as well. 

I know I need to compensate for electric, water/sewer, property tax, garbage, vacancy %, repairs/maintenance %, and capital expenditures.

High quality blue chip areas are where you make the strongest appreciation.

PS, I have no idea about any of the numbers since we don't have info as to what the actual repairs are, what the ARV is, and what your monthly holding costs consist of.

Quality time together and still getting things done.

Hypothetically speaking, I get a property this way, and it's worth 50k, do I have instant equity that I could use for repairs?