BRRRRing out of state, there can be a lot of surprise costs. 

Call a septic company and they will come with their truck, dig down so they can pop the top off, pump it out, and inspect it for you.If you've had contractors in the house, I wouldn't be surprised that things that shouldn't have been flushed were flushed.

like what kind of surprises can we see with REO like backed taxes, association etc?

It is my opinion that sponsorship groups that are struggling right now, but believe bringing pm in-house, are going to be in for a surprise when it doesn't solve all of the issues that they had hoped.

Put controls in place so that your rehab team can't hit you with a surprise bill, or misappropriate funds.

Not saying all tenants are bad, as most of us just want to make our rent payment on time and live our lives - but don't be surprised if you run into more headaches vs. spending a bit more money up front for peace of mind later on with placing better tenants. 

It's a great house and the price is perfect - surprisingly under what I would expect, which makes me suspicious.

I figure the worst case scenario, I don't sell anything but I gain a very significant amount of experience and knowledge about real estate (I would be surprised if this happen though as I do have a lot of sales experidence).

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

The vertical cost (construction cost) is consisted of material + labor + contingencies (surprises) + overhead + profit.