I've seen plenty of improvement in some of Baltimore's better quality neighborhoods, but overall I'm not sure why DC's population has exploded while Baltimore's has diminished and the city has continued to deteriorate over the decades. 

That way when the furnace goes out, or the roof needs replaced, or the driveway starts to deteriorate you don't freak out but simply go to the bank account you've been putting money into and pull out what you need to make those repairs. 

, much of the deterioration coming from chlorine in the water. 

Banks are sitting on unserviced liabilities, fees are amassing, the asset is deteriorating, the listing agent is doing work he won't be compensated for, etc.To restate the question: If there is an offer on a short-sale that is almost guaranteed to fail, does it typically prolong the foreclosure process?

In your sense, I guess I am hands off too. but you are right, I had trusted ppl on the ground, and/or have the infrastructure to keep them long distance. and when that infrastructure deteriorates, I sell asap!

That wasn't possible at my locations as the pipes were too deteriorated and rough on the inside.

You'll also want to ensure you have a good property manager to look after the upkeep of the property if you are not there to notice anything deteriorating or which may need attention.This article goes into a lot of the considerations about whether to form an LLC or not: https://www.mmpph.com/wp-content/uploads/2019/04/May-2019-newsletter.pdfCreating an LLC in California would cost you a minimum tax of $800 every year.

What matters most is the future, if the area you're investing in deteriorates and rent are cut in half your investment may be a disaster no matter how high the cap rate; if demand for your property greatly increases and rents triple you will make money even buying at a low cap rate.I use the cap rate as a filter for eliminating properties where I expect the property demand to remain stable.

I politely explained that we rehab houses not just buy them cheap to let them deteriorate!

Some of what you say would be better handled buy the trades themselves, a bad roof with mold in the attic is likely one issue needing roof replacement, get a roofing estimate including wood decking because if it is deteriorated it needs replacement (inspector report should make this clear).