I'm sure it's more due to the market conditions.

Foreclosure auction buyers cannot walk the property and have no idea of its condition.

Summary of expensesNOICap Rate Condition of the building systems  

It all depends on the market, economic conditions, seasonality. 

If it holds up under these conditions, you've got a solid investment—better safe than sorry!

Appreciation, maintenance, neighborhood, eviction rate, proximity, condition, etc.

-Structural (foundation, wall, ceiling and floor)-Roof and Exterior(Roof Condition,Gutters and Downspouts, Siding, Windows and Doors)-Plumbing (Water Pressure,Leaks, Drainage, Pipes)-Electrical (Wiring,Outlets and Switches,Breaker Panel, Lighting Fixtures)-HVAC(Air Ducts, heating and cooling)-Water and Moisture Issues(Attic, Mold and Mildew)-Kitchen and Appliances-Bathrooms-Pest and Insect Problems-Safety Features

On the plus side the rare times a Section 8 tenant moves the unit is in rent ready condition because it hasn't been ignored as occupied for 6-10 years.

I had an experience with a terrible tenant who reported me for a bogus claim but by making the claim it allowed me to gain access needed to get photos of the condition of the property, and then the tenant refused to allow maintenance people in which really helped prove my side of the situation.If possible, explore alternative dispute resolution options like offering the tenants a cash-for-keys agreement.

“it is VERY hard to screw up when buying i.e. a duplex in good condition in a desirable neighborhood and either self-manages or hire a quality PM to manage.”excellent point