Too much red, too much equity that could be used better.

What is it you do in real estate in Redding?

To me at my current knowledge level, this deal only works if taking over the loan - to limit the out of pocket money to acquire the property since the outside reno and new septic would take up the bulk of rehab costs. 

rlkey=nqll6j71hmuippapvh8fdgnv4&e=3&st=f4ummlca&dl=0It was hard to find a similar property which I didn't know if that was a red flag or not.

You can still build two separate homes on the same lot, offering investment flexibility.The streamlined approval process is a huge advantage, cutting out the red tape of lengthy public hearings.

My tenant never responded to the notice and won't respond to me at all so I have no idea what will happen.

In my case I began a “serious” real estate education and experience in 1979 ; by mid 1981 I was able to successfully conclude what for me, at the time, was my first “major” purchase.

You don't know all of the people living there so that's a big red flag as well.

Eliminate the red tape of going through a custodian for all transactions/investments3.

I do not see any meat on the bone in this situation.