I probably err on the side of holding vs flipping for a profit too much, as it's hard for me to mentally justify selling something now that I can 99% expect to be more expensive in the future. 

But as you correctly inferred from your albeit erroneous calculations, is that vacancy kills.

This is particularly true in California where regulation is reminiscent of the Soviet Union, people are nutty, and courts often err on the side of injustice.I also recommend "Every Landlord's Legal Guide - California Edition" by NOLO.

In that link I show why each of her allegations were erroneous. 

Your “research” is coming up with erroneous information and you are confusing terms.  

When faced with what feels like an ethical issue in real estate, always err on the side of full disclosure to all parties.

I have no written law to cite but I would err on the side of caution.

I'll check it out".I see a lot of investors seriously doing things wrong just because of a simple erroneous definition of a lead.Here is my definition of a lead.A lead is not someone that wants to sell their house.A lead is not someone that needs to sell their house.A lead is not someone that desperately begs you to please please please buy their house otherwise they are screwed.None of that.A lead simply is anyone willing to sell their house below market value regardless the reason.So every time you do marketing from a purchased list... wrong.

Such a strong relation to the type of company and team when they err on such simple things.

That is why it's good to be conservative and always err on the high side.