How will either scenario effect cash on cash return and IRR?  

Anyone know of the most cost-effective way to do this?

The most effective method for lead generation on the web is pay-per-click (PPC) advertising on SEARCH engines (google, bing).

In effect, I had a partnership, with my parents.  

Consider sending in a 9 X 12 envelope as they can't miss it.Unless you're mailing many hundreds, this can be very effective as it adds value to your service, beginning with "heads up" this us what your house looks like now.

A single member LLC has no effect at all on taxes, unless you elect special tax treatment.

He also has reduced the time I spend looking for houses by about 80%. without refucing our effectiveness or effeciency significantly. 

. -- means to engage in any of the following activities: (1) for consideration, providing any of the following services for another person: (i) selling, buying, exchanging, or leasing any real estate; (2) for consideration, assisting another person to locate or obtain for purchase or lease any residential real estate;The key here is for another person.

The right kind of development will have a positive effect on values.  

Overall this type of situation would make me nervous and I would not be excited about this rental group.Then again I don't know your market and that always effects things a lot, but in my situation I would rather wait until I found a renter I had less doubts about.