Make sure you understand the condition of the property and if you will need to make any significant repairs or rehabs.Also understand the tenant situation. 

I will model decreasing or stagnant rents, decreasing occupancy, and increasing cap rates.  

In my experience, if the property is in great condition, you won't' need the handyman more than two -three times a year top!

I am in the process of having my personal home appraised with the goal of increasing my HELOC.

You may be able to even access it earlier without a penalty given various conditions.2.

The apartment was always in pristine condition and they would actually leave and leave the apartment to us.

Should I increase the bid to their asking price?

No special development taxes...Sold One year now, 16% increase in equity.

I would assume that with an increase in renter occupied units in an area, the competition would be higher and therefore it would make sense to go outside of the area of competition (given other demographic information indicates the area is still appropriate for a buy and hold strategy).

(Assuming the remained of the roof is in good condition and not too old.)