CHANGES in NOI either increases or decreases the value. 

The rental inventory is decreasing as people move here, so rents are increasing.

They are creating good cash flow, but the value of the homes are decreasing since they are in not so good shape.

May not increase your income by much like you said, but could decrease your vacancy % and look nicer in pictures.

We have been able to decrease vacancy/expense and have no management fee.

Wouldn't other prospective buyers who know that a new roof is needed just decrease their offer accordingly?  

HUD funding here has decreased a little over the last couple of years with the sequester and stuff.  

After talking with the seller last night she refuses to decrease the price at all.

However, each month the tenant make the $1K p/mo rental payment $600 goes toward principle or $7,200 in equity a year (which increases every year as the interest portion decreases each and every year).

Obviously your return on equity is decreased, it may be offset by reinvesting the cash.