Scenario: 2 bed 1 ba house in high appreciating area in southern ca (west of the 5 for anyone who lives in San Diego) which is high priced now but being coastal and in an up and coming area is set to roll. 1 granny suite in the back with full kitchen and bath + Separate barn unit (not zoned for a dwelling unit but is carpeted). 

During the tear out of the room for updating after a tenant turnover, I discovered the cats had ruined the carpet leaving stains all over.

You WILL also have turnovers (i.e. vacancies) that require some degree of investment (re-paint, carpet,fire alarms, light bulbs, etc, etc) and while the vacancies may be short, its not easy to turn over a unit with ZERO downtime.Regarding your planned refi, I assume your 3.75% 30-year is based on an owner occupied mortgage? 

Does anyone have a good carpet installation/removal company?

We can normally get $100 increase if we do something for the tenant i.e. new paint, carpet, etc.  

It covers all common things such as burnt out light bulbs, holes in walls, holes in doors, broken appliances, carpet stains, broken fixtures, and so on.That way the tenant knows exactly what they will be charged when they move out (before they even move in).

I probably wouldn't have to do any repairs initially until the current tenants moved out and then I think it would just be cosmetic stuff like carpet and paint in one unit, or I could do some upgrades to bring it in line with the other unit. 

Do they want affordable properties with just new carpet and fresh paint?

We found hardwood floors under the carpet so we're having those finished as well.

I want to buy properties under $50k that need minimum work (paint, carpet) before putting a tenent in it.