Because those are REAL hardwood floors you can sand down 1/4 inch to help level out.Ton of stain choices and if done right, they'll 95% look new.

I want to stay in the short term rental business so my intent is to use the gains to buy 2 single family homes in a cheaper home in the outskirts of the city on a strategic location.

The "grace period" is our choice, at least here in Hawaii.

It is your money/choice in my opinion.

It just seems like the value at time of death would be the natural choice, but I can't find any info on this sort of situation.

My choices are buy another rental or lend the money for a 10% return.

In our area, renters expect new flooring, new kitchen, freshly painted house of their color choice and a gardener.Taxes-confirm with the locality it is close to actual.

But that's me because their ROI has been far greater than 6.16% annually over the years.In summary, I would take some of the advice from the other experienced investors in your thread and consider increasing the amortization to at least 20 years (unless you have a real strategic benefit from keeping it at 15-years) and also boosting the rents to proven market values.Please consider taking those considerations into account in your analysis and share an updated screenshot of the new numbers. 

I'm not trying to change your mind about earning a higher education but if I had the choice of having real estate debt vs. college loan/debt I'd choose the property debt any day. 

Joining the military is a career choice not a short cut to real estate investing.