I want to jump into mid-sized apartment complex investing.

He might spend 2k to do a rehab after 1 year and only got $840 in rent for the home portion ( not lot).  

I say it's what it would fetch on the market, but there really aren't many comps except on the other end of my block where someone demo'ed a house (anticipating later construction) on a same-sized double lot (102x134) but their cross street is a quiet street, and mine is busy.

The interest on that $11,000 portion would not be deductible, so that means 5.5% of the interest is not deductible against that property.

But if higher (likely because cost seg losses are much higher than few years of distributions) then there will be a good portion of losses suspended after offsetting the ordinary income, leading to ltcg being offsetted by the suspended losses upon deal exit.

@Jamie Derasmo on question 1, in this market if you want to keep buying you kind of need to look at everything, at least everything that is a size of a project you're willing to take on (which it sounds like this one is).On question 2, it really depends on how good of a deal you're getting, whether the numbers work to allow you to use hard money.

We have already had 4 separate groups of guests and are booked for the rest of November, a large portion of December, and we are currently entertaining a request for a three-month stay Jan-Mar.

When I lined up my PM, I got a file (large one) on every area they PM in, that showed me the rental comps broken down on a map (critical...zip codes alone are useless) for different sizes of properties. 

Then check recent comps for the sale of vacant lots in the area, similar in size and location to yours, with the same zoning. 

Houses that look very similar on paper (same neighborhood, style, square footage, year built, beds and baths) can have very different market values depending on things like interior light, flow, ceiling height, privacy, yard space, neighbors, curb appeal, master bedroom size, kitchen counter and cupboard space, parking options, driveway slope, proximity to noise or businesses, parks, schools, etc. - to name just a few things.