Investors come in with an overoptimistic mindset and they ruin their investment with no exit strategy.

They simply don't care, will let the house sit and go to ruin, list it with an agent and sell it...

That partially ruins the live in flip game...that is a big bummer. 

If under normal operations the property cash flows then it will cash flow better and be higher yielding in the case things should optimize in your favor.The consequence of not accounting for contingencies in your numbers and evaluations is that you may end up not generating enough money to pay for ongoing operating expenses then fall behind the 8 ball with a property, bad ending to it all and definitely buyers regret along with possible financial ruin. 

Let him know as much of your plan as you can without ruining your negotiating power.  

His reputation is likely ruined.

It's a chunk of change, but it beats the remote possibility of prison and/or financial ruin.

The guy found out who he was a sued him because my friend and "ruined" his new shoes.

Always use door stops that are plastic that stick on the wall, in the hallways use laminate or tile so that if one of the bedroom carpets gets ruined you can easily just replace that one room only, basically "idiot proof" as much as possible.

@Jonathan Feliciano this is a commonly used strategy in a lot of places, and it can definitely produce good returns and enhance the usability of a house when done correctly. ...though, there are also plenty of examples of it turning into a poorly-planned hack job that ruins the usability of a house...A few things to consider:-Does the garage connect to any wet walls, and is the sewer main easily accessed?