If someone is reading this and thinking, this is a great way to avoid bank financing, please keep in mind this is really best for seasoned and well balanced investors. 

When you buy another property, the money you spend buying it and fixing it up before its rent ready goes into the basis for that property.I had too much fun with this one last tax season.

While I was out of town, I read a few forum posts from seasoned investors chronicling their daily investing lives.

Some banks requires 12 months seasoning before they will allow you to use new appraised value.  

@Engelo Rumora I was wondering what more seasoned investors thought about this. 

This is a very important lesson for rehabs that think they will be able to do a fix and flip within 30 to 90 days and then be able to sell their house to just anyone because lenders require seasoning and in the case of FHA that can be between 180 days to 1 year and as you have discovered you cannot have the buyer pay for the appraisal.

Anyone from just thinking about getting started to some very seasoned investors. 

I think Union City is getting super heated, so it's hard to find quality returns, particularly in the 2-3 family range because you're competing with seasoned investors plus house hackers plus pretty much everyone who can afford a down payment.

Ski season in this area is busy from early December through mid March.

I don't have a clear picture after the first two years about when a property is considered for income vs. expenses- it might depend on whether it is underwritten by Freddie or Fannie- but the new property may have to be "seasoned" for another 2 years before it helps your DTI or it may count to qualify for the loan you are trying to obtain.