Have happy holidays and a prosperous, successful and healthy New Year.

If you can refinance and still achieve a healthy cash flow with all of the rent bumps and renovations that you have done, then I would do that.  

And look for damp soil conditions around the outside of the house. 

It is exposed to the elements and is just soil?

If its stabilized and you don't expect any major capital expenditures in the next 5-10 years such as a roof, furnace, or renovating any units then somewhere between 5-10% would be a healthy assumption. 

It was not disclosed to her when she bought it that it had some soil compaction issues and the foundation had some cracking.

Seems to be a healthy local economy with 3% unemployment to boot from looking at census data.

With a strong, varied economy and young population, I expect Colorado to remain a very healthy market for the foreseeable future.And, there is no guarantee you will find an easier market elsewhere.

Each situation is different, but my opinion is to make sure the "fundamentals" are good on your rental property; meaning that you are purchasing based on a healthy forecasted cash on cash return.

5% is healthy appreciation these days, good going. 8)