I thought I could clear up some information for you.1. 130k is a bit high for a rehab, most gut jobs shouldn't be more than 100k.

Especially the days when you discover that big capex like a roof being blow off (happened 2 years ago), some tweakers climbed up on the roof and gutted the A/C (did two of those in the last 12 months), an evap cooler leaked for so long that the drywall on the ceiling of the kids bedroom caved in (last year), the hot water heater blew a hose and a major leak went unnoticed for 10 hours flooding the hall, kitchen and living room (dealing with that now), the tenant smelled gas outside, the gas company came and shut off the gas because the underground pipe is corroded AND also discovered that the water heater is not venting properly so it got red tagged (just dealt with that last month) or the time the tenant "invited" a homeless guy over, he moved in, then called his other homeless buddy up and he parked his crappy RV with his entire family living in it in the driveway.

Finally, meet the GC for a quick lunch or coffee and listen to what your gut says.

Full gut rehab?  

I'm trying to get the ugly picture in my head.The property needs a gut job full restoration and is surrounded by vacant lots and crummy streets,is that right?

Trust your gut and the math analysis on prospective properties.  

My total cost to purchase and gut renovate the 3 bed 1 bath rowhome was 110K. 

His words kicked me in the gut after I bought two houses for $25,000 that needed at least $15,000 each.  

The home needs a lot of work, including lead paint removal, some asbestos removal (don't know of the extent yet but I'm planning for the worst), new roof, new siding, rewiring, and an interior gut and reno (kitchens, bathrooms, etc).

My gut tells me that I have some capital in either of these home that I could reinvest in a "better" rental market.