(i.e. if inspector misses that the roof is needing to be replaced he is off the hook and I am screwed because I bought a house with a bad roof).

ARV is a little thin, but if you plan to hold for a long time that isn't a major concern.Is there any deferred maintenance or do you see having to replace any major items in the short-term (garage door, furnace/AC, water heater, etc.)?

Hi Avrohom,My first suggestion would be to talk with your CPA and RE attorney, although if the deal is already done then you can't go back and change anything.In answer to your last part of the post, it's not a "problem" if you don't use all of the proceeds from the sale toward the purchase of the replacement property however any money that is not used will be taxed as a capital gain.I have done one 1031 exchange and this is my understanding.

I've asked the tenant TWICE to make arrangements with my sprinkler repair guy to come over and replace old sprinkler heads and adjust the system.

A substantial reserve would be essential to make it through a general downturn, as it would also be a time when finding replacement buyers would be very difficult.

Since Friday we've completed demo work, replaced a floor joist, and removed an ugly and useless wall (other than being load-bearing, that is) to open the floor plan.

My goal is to replace my 40-hour job with passive income from buy and hold SFHs and/or small multiple-family properties.

We even replaced all of the duct work to make sure there wasn't any remnants of the smell.  

Landlord must show proof of cost estimate for replacing the carpet (~ $300) and must return the rest to the tenant.

Obviously septic tanks are expensive to repair, old A/C and roofs need to be replaced, etc.