Anyone wanting to do it should consult the proper authority like an attorney, of course. orIf I hadn't lived in the property then I would figure out a way to do a 1031 .

HVAC tech thinks the simplest path is to remove the oldest big furnace and replace it with a new small furnace for one upstairs unit, install a second new small furnace for another upstairs unit, then use the newer big furnace to heat the main floor. 

It highlights all the pitfalls but the 3rd section is how you properly structure buying a home with your LOC.

If that doesn't work, move up the proper chains of command in the city (city engineer's boss/head of DPW, etc.). 

What are the proper steps to take to get started.

You'd need one helluva track record to make the bank feel comfortable that the owner/operator is going to handle a portfolio like this properly, and make good on their investment.Do you have any experience operating projects this big? 

And for water/sewer, you can either install sub-meters and charge for usage (better way, but more expensive) or just come up with a flat fee and pass it along to tenants.That's my two cents -- hope it helps!

Then consider installing a perimeter drainage system and sump pump if the bsmnt. is still wet.

For example in my area Sheetrock is $25 per sheet hung and taped, roofing is $300 a square installed, electricians figure one hour per device, framing is $1 per square ft.

The $5k to $10k difference is basically your GC's overhead and profit to manage the project and make it worth their time.Here's what I would expect to pay if I managed it myself:KitchenCabinets Material: ~$4k or lessCabinet Install: ~$1kGranite Countertops: $1.5 to $2kSink & Kitchen Faucet, Disposal, DW & Ref Hookup $500Appliances $2kFlooring (200 sf x $6/sf) = $1,200Electrical/Lighting = $500?