Two SFR Property Analysis. Need Advice!

[Evans Wright]

I have two top contenders that I am seriously considering for rental properties and would appreciate your input as this will be my first investment property.

First a little background on my strategy.  

My plan is to acquire a SFH and move in for a few months and rehab the property while in it then eventually move out to another and repeat the process. I am in the military so I will use a VA loan to acquire the property with $0 down. The allowable limit for $0 down in my area is $417,000. After acquiring the home I will use my cash to rehab it then rent it out when I am able to get into another place. My plan is to follow the Buy Rehab Rent Refinance model. Now the two properties that have caught my eye as future investments.

Property 1

The current asking price for this property is $140,000.  It has been on the market for just shy of four months so I believe there is some definite wiggle room in that price.  This is very nice part of town and houses usually sell for $20-30k more.  This place does not show that great  and is marketed as 4br 2ba but one of the bedrooms does not count since its in the basement and does not have egress window(the window looks into the garage...) My repairs would be redoing the kitchen with pre-fab cabinets and new appliances from home depot, new garage doors, making the basement bedroom legit with an egress window, refinishing the basement with new carpet and paint and new fencing in the backyard.  I estimate these cost to be around $12000.  

Mortage payment would be $657.93 amortized over 30 years. Total monthly expenses would be around $1026(including property management). The property would rent somewhere between $1200-1300. I used 1200 in my analysis and came up with a monthly cashflow of $174. The advantage to this place is the equity I would have and I feel like would be great for the BRRR model.

Property 2

The current asking price for this property is $159,900.  This is also in a nice part of town and a 5 minute drive to the military base.  Prices for homes in this area are pretty close to asking I have not seen anything more than $174k.  It is listed as a 5br 1.5ba.  Like the other property the two basement rooms don't count because they do not have egress windows(one window leads to garage another to under the deck...)  My repairs would be swapping the bedrooms to the other side of the basement and adding egress windows and making the 1.5 bathroom a full one.  Other than that the house is in great shape and shows really well.  Estimated repair cost would be around $4000.  

Mortage payment would be $737.82 over the same period.  Total monthly expenses would be $1102 and I am estimating around $1300 for rent netting a cashflow of $198.  The advantages to this place would be making it a true 5br 2ba which would add some good value, less repairs and an exceptionally well cash on cash return.

Woah that took forever to type up.  Any advice on what route I should consider  or additional info to think about would be greatly appreciated.  Thanks everyone.