Ineligible Properties using a non-recourse loanI have found that when using a non-recourse loan for purchasing real estate under an IRA, the few banks that currently make up the non-recourse loan market have the following criteria:Eligible properties with a non-recourse loan-Single Family Residential-Warrantable Condo's (100% complete, 33% or more sold, and HOA turned over by developer)-PUDs/Town homes-Duplexes-4-Plexes-Multifamily (5 or more units)Ineligible properties if using a non-recourse loan-Residential with large acreage-Raw land-Farms-Manufactured or log homes-Non-warrantable condos-Hotels, condo-hotels-Co-ops, Timeshares-Senior or assisted living facilities-Non-franchise restaurants-Entertainment properties-Mini-storageAn alternative to obtaining an non-recourse loan financing to an IRA from a bank is through a private hard-money lender that in which case would would be more lax regarding the above criteria.

Not saying that its wrong, but definitely warrants further investigation since that's really low and taxes in Texas can take a bite out of cashflow.Note: I don't own any investment property in Houston, but I owned my primary residence while living there until recently. 

As a Seller I try not to give any reps and warrants, and as a Buyer I always try to get them. 

Yes, the market is hot now so caution is warranted, an yes there are and will be short term market fluctuations, which is why you need to find a great deal below market to insulate you to some degree from these fluctuations.You asked are you missing something?

Can qualify on credit score and income, it's the liquid assets that have proven problematic - along with the recently-learned fact that the building I want to buy into is non-warrantable. 

Does this discovery warrant price reduction ?

Foreclosure, multiple judgment's, tax warrants...etc. 

Unit x 12 $750 Total $9,000 Income Monthly Annual Potential Rent Collected $9,000 $108,000 Vacancy Loss $900 $10,800 Gross Rent $8,100 $97,200 Operating Expenses Monthly Annual (% of Income) Management Fees $450 $5,400 6% Repairs and Maintenance $900 $10,800 11% Lawn Care $0 $0 0% Gas $0 $0 0% Electric $50 $600 1% Water $150 $1,800 2% Sewer $66 $792 1% Snow Removal* $40 $480 0% Roof Fund $0 $0 0% Taxes $600 $7,200 7% Insurance $666 $7,992 8% Operating Expenses $2,922 $35,064 36% Financing Monthly Annual Principle + Interest $2,725 $32,705 34% Performance Monthly Annual Net Operating Income $5,178 $62,136 - Financing $2,725 $32,705 - Improvements $167 $2,000 = Cash Flow $2,286 $27,431 Custom PITI $3,991 Cap Rate 10.4% GRM 6.2 ROI 22.9% Ann Inc - 10% / Purch Price 14.6% I plugged in 600K for an offer price because that warranted a cap rate of 10%+.  

Being that this is a small condo, there are some exceptions that might get you financing as long as its owner occupied.If this is an investment, then you will need to look for non-warrantable condo financing.

Lenders are subject to search, seizure, and audit, without regulators needing to demonstrate any probable cause or obtain a warrant.