I'm new to RE overall and have a full time job so it's hard for me to offer capital or find deals to bring to the table at the moment. 

In the beginning we were looking at duplexes, they wanted to put their toe in the water.  

This is for installing a short 40 gas gallon water heater.  

With the property suddenly under water, I decided to rent and wait it out.  

You operate a business and to stay above water you need to make money as well.

I also know that water pools above our unit and then freezes at night.

The rate will be a bit higher, but you can keep buying.I would agree with this statement however finding a residential portfolio lender especially at a fixed rate and an acceptable amortization table if buying for cash flow may prove challenging. 

In Calif, it is code to have the water heater strapped to a wall - - and yes, they take pictures and report the condition to ESCROW, not the city.

Price dropped to $45k and the numbers are as follows. 4 units, 3 tenants($425/month), $15,300 gross, Recently connected to City Septic but has a Water Well Connection(can be switched back), Repairs around $25k(kitchen and bath need upgrading) along with  maintenance.  

Just be careful and not over do it, and get yourself under water.