But getting professional advice will help you navigate any specifics.

In California, is it required that you use the C.A.R. purchase and sale form specifically?

It is delinquent enough (Greater than 90 days but below 120 days(can't file first legal until after the 120th day by federal rule (Except under very very specific circumstances)) to where the lender or servicer has sent the breach letter (Notice of pending foreclosure) with an expiration date that the loan will be referred to a foreclosure filing (Trustee/attorney) if the borrower(s) don't cure the breach within that defined period of time.* A notice of default is not a letter sent by a creditor saying they are late.

Alternatively, construction is a great field to get into.  

Are there specific factors or trends you would suggest evaluating to make a more informed decision?

Once the option period is up, cancellation would only be for items specifically named as contingencies, such as financing.   

I think there is a big opportunity around some specific spots around Atlanta in the next few years. 

For example, for rental properties, lots of the categorization depends on the REI's specific tax strategy regarding what we're capitalizing versus what we're immediately deducting.

This is very much lender-specific and will vary. 

Which specific cities are these new builds ?