Also, when I sold another place I payed off the HELOC and it is ready to be used again.  

I have a family member ready to walk away from a house she bought with an FHA loan right before the crash. 

With the HELOC, you can then draw the funds you need to purchase when you are ready to buy.

2) After converting to a rental, I understand the expense to get it ready to rent can be used to deduct rental income. 

I wouldn’t hold for more than a week or two if your place is move in ready.

I still very much enjoy working on cars, and plan to continue doing so because I love it, but I'm ready to start growing my wealth as well as generating passive income.I've owned a few homes, I have some experience as a self managing landlord, I've made some mistakes and had a couple big wins as well.

I am ready to dive into real estate, watched several of the bigger pockets webinars, listened to the podcasts and read several books.

It's a gamble in some ways, as I don't know if I'd be able to build what I want due to zoning.prop #2- crappy neighborhood. 1/4 acre, BUT-has a single family house, small garage, plus warehouse space that's ~2500 sq ft. zoned C. cheap. house is also a total rehab. closer to "move in ready", but honestly, the crime in the neighborhood is to the level that I don't think I'd bring my kid there now.

After a couple of walk throughs, I determined that the house would need all new flooring along with paint to make it rent ready.

In service means it's ready and available to be rented whether it's actually rented or not.