I am just unsure about if because they are built into the current lease if I will have to keep them thus incurring that additional expense.

My understanding of the strategy is that you would find a good investment property, increase its value and stabilize it, and then refinance.Pulling out cash from your primary residence tax-free can be great, as long as you are getting a better return than the additional interest you are paying.

It might weight one location above another if it's already on your list of possibilities for other reasons, but it wouldn't be a determining factor in any way for me.Really, you can do real estate anywhere in some shape or form, so you can move where you want and figure out how to make real estate work there, or move where you want and figure out how to make real estate work for you "long distance".  

In addition to the bedroom/bathroom work, we also added a covered front porch without a permit that we planned to disclose on the sellers disclosure at the time of sale rather than getting permitted.

In addition, the landlord stated that they have some student loans tied up with the mortgage as well. 

Basically, if you purchase at the median price, then you probably won't be able to pull any additional money out.

It is no one's fault but the experienced rehabber realizes this is likely and has addition funds set aside (and additional margin) for the associated additional effort.In summary there is no argument for thinking the realtor's rehab estimate is likely to be more accurate than the contractor's estimate. 

Additionally, I would look for a lender that's upfront with their fees/process upfront so you know what's expected of you in terms of docs and criteria, time to close, and the cost of closing a loan with them. 

In addition, it would be helpful to talk to the exiting residents and see how much appetite there is for them to own and to get a sense for their financial strength.Hope this helps.

Bearing in mind that I have an additional expense of a property manager, I've been in the "get rich slow" camp, looking more towards the future.