You might expect to spend between $2,500 and $7,000 on average.

Typical might be average $6,000 a year in distributions a total of $30,000 with the balance of $70,000 from increase in value.So you might look at that breakdown, the more cash flow the less appreciation dependent the deal is. 

What are the rent and vacancy rates, would you be able to afford the expenses of that property with no bookings?

Logic doesn't matter in your discussions with them nor does the law, unless you are prepared to use an attorney to force them to follow through litigation which they know is an expensive proposition.If you do not have the appropriate zoning for a project of this nature, have any  hint of wetlands on the property or are familiar with the hoops you will need to jump through tread very carefully.  

But it is a conversion from one rental to primaryOther alternatives to achieve the basis transfer would be to sell both and buy a new one but that would trigger income taxes and sales expenses that may be more than the tax savings from basis carryover. 

Last year, the property averaged nearly $2,000 a month in rent when you include late fees.

(Note you will have to pay taxes on the interest earned).Also, you could invest in the S&P 500 which on average has a 10% return each year. 

To everyone out there, a key thing to take from this post is you are the average of the five people you surround yourself with.

I'm sure they're working diligently on it but 30 days is an average vacancy for the Memphis market so that's not alarming just yet.

I say depreciation, travel, and auto expenses aren't passive and those should at least count for something.