I can give you very high level calculation to understand both scenario...Lets say you buy 100K house with 1000 rent... lets compare all cash against leverage...All cash InvestmentYearly return = 12000 (Rent) + 2000 (Appreciation) - 3000 (Tax + Insurance + Capex) = 11000 = 11%LeverageYearly Return = 1000 (Rent Cash flow) + 2000 (Appreciation) + 3000 (Amortization) = 6000 = 6%Now when you leverage investment at 20%, you can buy 5 house from 100KYearly Return of 5 Houses = 6000 X 5 = 30000 = 30%There are more tax benefit in this deal also as your positive cashflow is lower...If you are planning to buy multiple houses, Leverage is always better...

During the escrow is it possible to put it in a LLC... or would that trigger capital gains taxes?   

Do either of you see any benefit to buying the propane tanks outright? 

This has been discussed in other threads going back for months, esp the number of condo projects now coming online, when you have a building with a few hundred units completed it’s going to have a major effect on the YoY numbers when the whole county new listings are only around 4000 per month. https://seattlebubble.com/blog/2018/06/12/around-the-sound-king-county-sees-the-biggest-gains-in-listings/

If the first is short then the second has nothing to gain by approving the short sale.

Better for gaining a reputation as a landlord that will work with their tennants rather than one for being a hard ***. 

And your business experience in GC / remodeling will be a huge benefit for you.Well done and keep us all posted on your journey.

But we found out that we will get taxed 32% capital gains on the sale.

If he still has positive cash flow after a refi, then he should refi and reinvest for two reasons:1 - To actually get some gains from his equity2 - To protect his equity which is now at risk...as @Thomas S. has already stated

My new tenants are gainfully employed and very nice.