I'm not saying this is a "bad" deal per se, it sounds like he wants to get into this type investing and doesn't want to be responsible for any losses.

I'm originally from SE Missouri, now in Tuscumbia area with family. 

Walk the streets and se what other homes are asking. 

In my case, I can go into the same zipcode, and in the NW corner have it perfect for flipping, the SE corner perfect for Holding, the SW Corner perfect for both, and the NE corner where neither will work...and the size of the zipcode is only 2 miles by 6 miles.

Nothing will help you to get to know the area better IMO.I did some quick searches using a min of 120k list price up to 250k and there are LOTS of nice existing homes to choose from in that price range - found a few spec homes SE near Pawnee/Webb Rd that were on the market as well.If you want to dive into the investing world nothing better than buying a duplex, living in one side and renting out the other.  

It is probably more flat than a decline per se.

My take based on everything I've seen is that it would more than likely not be considered dealer status and therefore not subject to all the SE taxes.Are there other things I'm missing that would suggest otherwise? 

Technically wholesaling is not real estate investing per se.

I try and put every expense into a specific category of the SE.

But I would not think of it as negative cash flowing per se.