With that broad parameters they set, I am planning to put a cap on finishes as part of the proposal, say for tiles it will not exceed $2.00/sq ft on the finish material (grouts, mortar and etc not included as finish material and represent tile only), or give out colors on the countertop (ie gallo lines), so they would not choose anything expensive, basically I will be setting cap spending on top materials.

Bill Gulley Nailed it. 

Ensure they have not placed a cap on the number of rentals in the building and if there is, make sure the current number of rentals are significantly below that figure.

@Matthew Smith it is easy to look at tax sale and say "How can I lose" Trust me it is a risky business and you certainly can lose money.You pretty much nailed the number one risk; bidding to much on a property.

Nail it, then scale it.  

My advice, newbie to newbie, is try and nail down a location and type of home.

You hit the nail on the head!  

., which I think he really hit the nail on the head with his comment,: :"it's important to realize that there is still a big physiological barrier for people".People love Vancouver because it is cheaper and because the income tax in Washington is nicer come tax season compared to an Oregon address, but you must realize there is a reason for the price difference.

We end up eating the cost of things like nails, putty, caulk, buckets, paint pans, rollers, putty knives, trowels ect due to waste and the tools ect walking off with the contractors.  

I think you nailed it when you said if it's not serving your purpose, let it go, and find something that does.