Values drop, sometimes drastically, rents go down as quality of tenant declines; cost of operstimg properties increase, and governmental interference, especially in the form of rent control, can slash values and profitability severely. 

For someone that's not as conservative, or a different view on the cycle, they might have a different opinion than me on all of this.2) Sponsor quality check: (takes about 45 minutes per deal)I believe that a great sponsor can take an average looking deal and make it great, and that in mediocre sponsor can take a fantastic looking deal and make it bad (especially if there is a severe recession).

The high cost did not match the quality of the content or the level of support provided.

@Abel Eskinder since you're out of the country, you'll probably want to give some thought to our copy & paste info below:-------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a Class A property in Class D area, what quality of tenant will you get?

In these states I assume that just like a standard foreclosure, all funds acquired during the sale that exceed the outstanding contract balance and any liens on the house go to the contract buyer (vendee?)

My recommendation would be to partner with Realtor for referrals so you can spend your time on what you do best.Either way, with your criteria being so specific, you'll likely end up with quality leads and an additional income source!

Ensure that the updates are of high quality yet within budget to maximize the increase in value.When it comes to refinancing, after completing the renovations, you can refinance your home to access the created equity.

The one we used said they ran his outstanding debt

Perhaps hire the PM as a second set of eyes for quality control but that should be in addition to the GC you should hire from day one. 

Your subcontractors will work more efficiently and provide better quality work when they are not dealing with construction debris interference.3.