Add into the equation the cost of materials and it makes sense that builders are finding ways to cut overall build costs and one of those ways is to buy land cheaper. 

Put 3.5-5% down, retain most of your capital, and get started that way. 

Here's some basic beginner advice with some reading material that will answer 80% of your questions.1.

From my experience (I could be wrong) there isn't a format but the estimate should list details like the materials to be ordered and the hours of labor needed for each repair project (for example the kitchen cabinet installation or exterior doors) along with a cost listed for each line item.

The handyman gave me a quote for $5000 and $300 for materials.

You need a good lease agreement, landlord forms library, educational material, and landlord attorney to guide you. 

That property was run down, smelled funny, and it looked like the cheapest materials were used in there which are just going to fall apart year after year. 

The quote was $5352.00 ($3,650 for labor and $1,702 for materials).

What if the new owner backs out of the job and gives it to their "regular guy", will the original contractor come after me for any expenses/materials spent?

Contractors don't make a living off marking up material prices.