Buying an occupied SFR: Potential Red Flags?

[Spenser Harding]

Found a house in Tacoma, WA that the seller inherited and wants offload as she wants nothing to do with being a landlord (Great! I'd love to help!). I requested some information from her agent and only recieved very poor, awkwardly taken, funny angles of the exterior. So I hopped on Google maps street view for some more clues about the condition - the house sits on lot perpendicular to the street. Interesting but not the end of the world, some opportunity for some curb apeal to be added for sure. I requested a time to view and was told that I cannot view the inside until a signed PSA and do and inspection. It was noted that this is due to tenant rights. So I thought that this might be some sort of red flag here. I browsed Washington State law and didn't find anything specifically stating you could not enter a home intended for purchase with tenants inside. When I searched BP - I found great horror storries of nude tenants, drug equipment, dead dogs etc. so I know it can be done. Is it normal to have to spend $300-400 on an inspection in order to view the inside (I feel that it shouldn't be) or is there a better alternative that someone can suggest?

[Tom V.]

It is not unreasonable to ask for a signed PSA prior to requesting a tenant open his home for a third party inspection.  

Your PSA must have contingencies to get you out of contract if the home is horrific.

If you can't negotiate a price wherein you will be willing to venture $3-400 for an inspection (if you are uncomfortable doing one yourself), then your risk tolerance for flipping this house is too low, or it isn't a good deal to begin with.  

You have to ante up a little to sit at the table.  Normally an inspection from a third party is a great tool for a buyer.  You get in contract at price X, then your inspector 'uncovers lots of problems' and you negotiate down to X-Y.  Y is almost always greater than the cost of the inspection.