Since then, I added an additional bathroom, increased its value, was able to do a cash out refi and pulled out my down payment.

My question is do we do this in one big increase? 

Leases are usually flat (no increases) and for a period of 5 years, with two 5-year options to renew at a predetermined amount. 

The main factor for me, if I try to correct the tax records, it might end up getting into higher tax bracket  and it may not be attractive investment anymore, but the big question I have is, will the city/county put it into higher tax bracket if we increase number of rooms and dont have to increase sq ft size at the tax records?

Or, just increase your rents ~$200/year.

If I don't pay cash, I pay off as quickly as I can to increase cash flow.

Here are basic stats on single-family home sales for March 2018 for the City of Austin and the greater Austin area:In addition to Austin's housing supply and affordability issues, we can now include increasing mortgage interest rates to the significant forces applying downward pressure:The Fed is anticipating three to four rate hikes in 2018. 

The recently rehabbed unit should be able to rent at top of market because the unit has just been rehabbed.Repeat for each unit.Prior to moving out (so while still owner occupied) refinance pulling out your initial investment due to the increased value from the rehabs. 

As for landlord tenant rights, it seems like its better for landlords in some ways such as rent increase and evictions. 

With the new rent increase it’s now like 2.5 percent.