Just say no.I would almost never do this trade unless all my downside, including potential unknowns, were completely compensated for. 

I would strongly consider building equity to make a stronger down payment and further decrease your monthly cost. 

This allows for deferral of capital gains taxes until December 31, 2026, with potential reductions in the taxable amount if held long-term.

If you have a good FICO, a decent down payment and closing costs, go ahead an do the first one. 

From there it is really just a matter of determining comps, cost to rehab a property, and your timeline.I have helped several investors flip their first home in Austin and learn how to do it effectively.

I want to be able to find potential markets/listings nationally based on the return. 

CA is arguably #1 in the USA by a long shot for resource-potential-of-awesomeness.

I have a pretty large emergency fund in place for those properties, but I wonder if that capital could be better employed elsewhere (potentially acquire another property).  

That may increase your cost or limit the coverage you can get.The Year that the following were updated (either partially or fully) would be good to know:- Heating systems- Roof- Plumbing- electricalSome companies will not write properties with systems that have not been updated.As long as you are living there, the proper policy for a 1-4 family is a "Homeowners" policy.

The justification for eminent domain would be the cost of defending the current set up, health costs and environmental cleanup costs.