Start where you stand, and work with whatever tools you may have at your command, and better tools will be found as you go along.

I haven't looked into building new construction in the US, but you feel confident that for $400k you can build a house that can command $2M?

The acquired building were over 100 years newer and had more modern/desirable features like central air conditioning, integral garages, and fireplaces.Another time I 1031ed property in a distant town for property much closer at hand and easier to manage, it also commanded higher rents.

A mature property may command increasing market rents for 20 years or more as well.

It can command around $1500/ mo rent.It is a FNMA REO and they are asking 200k.

You can find it on Amazon here: http://amzn.to/Zv0ZphFrank also has another book called '10 Commandments for Real Estate Investors' that I reread every other month or so as a reminder: http://amzn.to/15ikXL0Ken McElroy has two great books on apartment investments and one on property management:The ABCs of Real Estate Investing: The Secrets of Finding Hidden Profits Most Investors Miss http://amzn.to/HdXVf1The Advanced Guide to Real Estate Investing: How to Identify the Hottest Markets and Secure the Best Deals http://amzn.to/1bcWx50The ABC's of Property Management: What You Need to Know to Maximize Your Money Now http://amzn.to/1d518JKAlso see Ken's BP interview on Podcast 052: Buying Apartment Complexes, etc. here:http://www.biggerpockets.com/renewsblog/2014/01/09/bp-podcast-052-raising-millions-ken-mcelroy-rich-dad/I think these are the place to start, but there's many more let me know if you'd like to see more.

If I am doing that, why not update and command higher rents, leading to tenants staying longer and renewing more.

Trendy high end condo type houses would logically command a higher sales price, and even if the profit remains the same, I'm sure the properties will move extra fast if correctly priced.

This same exact home in Mesa would get $800-900 per month, while in Scottsdale, it might command $1,100+.

I would recommend the 50% rule before the 2% rule when making a purchase price estimation.In other words, if the house will command $1250/month in income, about 50% of that ($625) will go towards all your expenses.