They decline the offer then cut the price and disclose the inspection findings.

That particular deal ended up falling through anyway, but my concern is that this will continue to happen and I will end up killing many leads when I politely decline advances before a deal is finalized.

He declined our offer and didn’t counter. 

The ones that aren’t and I find any discrepancies are automatically declined.  

The underwriter doesn't want to see declining income by more than 20% from the previous years income though.

If the tenants destroy the property, then they could loose their benefit (at list that's what the Sec 8 office told me I never experienced it) Also Landlords are allowed to give surprised visit to applicant's current resident prior to approval and if the property is kept in bad shape or they don't allow you to enter and inspect, then you can decline the application.

Since then, my mother's health has declined and I am spending more and more time in Tahoe.

As interest rates rise and property values decline, my advice would be to season a LLC or a few to DnB Paydex scores of 80, build two 800 FICO scores and study how to pay zero income taxes (incl. studying WA business taxes vs. no state income tax rules).

Does the housing market's amount of sales decline significantly during winter months?

But in a sideways/declining market, even a solid operating team would have a hard time turning around an asset.