After analyzing the local Mercer County market I've noticed there are not that many MFH that are desirable meaning cash flow can occur, but appreciation, schools and good tenants will be at risk.

If the investor's opening bid is the only bid, then that is the market speaking regarding the value of the house being no more than the liens.

I’m curious where your rents are compared to market rents?

The other issue is since Colorado market is so hard a large amount of my entitlement is eaten up from my first house.  

My specialty is building broker relationships and bringing quality off-market deal flow. 

I called every facility in my market, introduced myself as a burgeoning investor, and asked if they would consider selling.

What research have you done on rental Days On Market?

I am somewhat concerned about the current housing market.

The cabin belongs to an acquaintance who doesn't want it anymore and is giving me the option to purchase it before putting it on the market.

The only change to the existing law was to expand the definition of "Provide real estate brokerage services" to include the following:Regardless of whether the activity is engaged in for another person, engaging in the buyer or selling, offering to buy or sell, or marketing of real estate or otherwise dealing in contracts, including assignable contracts, for real estate or options on real estate, on two or more occasions in any 12-month period.Principals buying and selling on their own account clearly fall within this expanded definition.