Any investment in improvements would have been capitalized as basis and thus subject to depreciation recapture.It is not an all or nothing transaction however - you can do a partial exchange, but will owe tax on the amounts not reinvested. 

At the negotiated price the property, it would be a 12% Cap before any improvements (raising rents and charging for utility overages).

In addition units with a readout of the ppm of CO is nice for the firefighters or yourself to be able to tell why the alarm went off in the first place in the event the tenant opens doors and windows to ventilate before you get there.

It may be wishful thinking on my part.Do you think any improvement outside the house like fencing or invisible fence etc for dogs will help attract potential renters for future buyers?

The reason is because your investment horizons is likely 5-7 years, and you can get cheaper financing with an ARM that will improve your cashflow and you won't have to worry about interest rate risk until later on when you decide to sell.

Perhaps you do, but I suspect they will not significantly help improve the bottom line on your tax return.As an aside, since you have not bought your first investment property yet, your creditworthiness will be based on your current employment income supported by your last two years of tax returns. 

(b) Leases or rents or offers to lease or rent, or places for rent, or solicits listings of places for rent, or solicits for prospective tenants, or negotiates the sale, purchase or exchanges of leases on real property, or on a business opportunity, or collects rents from real property, or improvements thereon, or from business opportunities.

Sounds like maybe the home has been over-improved  ffor the neighborhood. 

That's without any improvements.

I began improvements, and started making friends in the new area.