I think the answer to your question depends on the type of tenant you would be targeting.

California is the only state that has essentially put a rent control type of restriction on home owner insurance premiums.

Worth noting that most firms will do two types of studies (although they may be named differently) - detailed engineering and modeling.

What made you interested in investing in this type of deal?

Also what types of cabinets, countertops, vanities would get me the best ROI in this area? 

Pricing and risk levels are about the same for the same type of stuff in either city.

+I've researched something called an FHA Construction loan in terms of financing this project, but it seems that most large banks don't offer that product.

What made you interested in investing in this type of deal?

You steered away from a product that obviously works (look at all the students here defending the product) and makes you a ton of money because you didn't like how the creator of the program "seems" to act in a forum.

These types of properties require experienced management to navigate the challenges effectively.