@Dan AudinoFor path #1, is your eventual goal to rent out the property?

We manage a property that was having drain field issues for awhile, got estimates and had the owner approve one of the vendors.

I imagine people who've had 2nd or 3rd houses in hollywood hills are not interested in rebuilding or doing the work.  How do I go about finding those who'd rather just collect the insurance money then sell it off at a...

@Andreas Mathews admirable, but make sure you do some research so you understand what a PM can make.Starting your own PMC business will require 75-150 doors to make a decent living, depending on gross rents and your fee structre.Working for a SFR PMC as a PM, will require a RE license and you usually get paid a percentage of the gross rents the portfolio of owners/properties you manage generates.

What other methods should I use to acquire another property? 

I have little confidence in turnkey providers, deals are already hard to come by, if they take another 20% cut before.. much better to buy a property from an owner that is in good condition.

We sell the property and each side get their money returned off the top then we split the profits 50/50.

Would a property with 4 bed or 5 bedroom would have a better cash flow ? 

So, your property must be secured with deterrents to hopefully stop this from happening - but, it's impossible to guarantee security.

I walked to the house and met a man who says he was cleaning out due to the loss of their mother in some few weeks back.The guy told me she is  left with 12 years mortgage on the property to pay the bank.