I have been searching for REOs in my local area (Austin, TX) and have found some "good deals" comparing listing price to other houses selling in the area with same square footage and general characteristics.

If not, then what do you think are characteristics/ skills they should have for you to work with them?

@Donna RaganA partnership and a domestic LLC refer to two different characteristics of an LLC.

For collections purposes, we consider behavior score, time on books, cb score, balance characteristics, LTV, utilization, etc.

These are people who share motivational characteristics of people ready to sell, but haven't yet done all the work they think they need to list property.

What characteristics would make this the easiest to do?  

However, I wonder if there are characteristics, tendencies, and trends emerging that are moving you towards or away a specific strategy. 

It seems to me that in your case the location characteristics made it very difficult to make money.

Major city, great market characteristics, affordable for positive cash flow = many of the benefits of cheaper markets like the east coast, thunderbay, smaller towns like cornwall (as mentioned) with higher support of being a major Canadian city. 

Prefer Cape Coral or Naples area, but would consider anywhere in SW Florida if the property holds the right characteristics for my investment AND lifestyle criteria.