You do not get new depreciation for the loan you've taken out, so be careful that you are not going to be taxed on income you are not physically seeing.Another item, If you cash out to purchase another property you must follow what is called the Tracing rules.  

How many items of disrepair would need to be covered to make the cost of the warranty worth it?

But, if they did not want you do do that, you could create an addendum to their original lease modifying mutually agreed terms.Regarding the resident's items, you open yourself up to large liability if you give permission for anyone to touch or move the items. 

That being said, I would expect an itemized receipt that breaks down, what had to be done. 

Return:DIY the cosmetic or value-add items such as paint, landscaping, and fixtures.Budget for licensed pros on structural, plumbing, or electrical.Always compare current rents versus after-reno rents to make sure the numbers justify your sweat equity.If you’d like, I’m based here in Georgia and work with investors on multifamily and house hack deals regularly.

Other action items are getting quotes from architects, engineers, and GCs to see if you are able to financially do this type of build out.  

For the upstairs, I’d prioritize the “first impression” items—fresh paint, new flooring, and a clean vanity go a long way with renters.

And what kind of updates do you want on repairs—do you want a heads-up for everything, just big-ticket items, or something else? 

Original basis less depreciation plus cap ex items equals new basis. 

Here's a link to the IRS website noting specific items that are included in the cost segregation study report.