Should PM take some accountability for the annual inspection fee being charged and have uncovered these kind of tenant issues?

For what its worth most deals I deem meeting minimal IRR standards is 13-15% but you have to dig a little deeper to uncover the real placements of cashflows and capitalization events... and then dig even deeper to verify the assumptions such as occupancy, rent increases per year, and what reversion cap rate was used.Again I don't look for IRR cause its manipulated a lot instead I look at total return on a 5 year basis.

Lots of listings state seller will not do any repairs, however, if you uncover hidden items not present during standard initial walk through, you can certainly re-trade the price to cover the added costs.

I'd love to drive around a brand new 4Runner because they look so nice, but my '06 serves me just fine and I don't care about a small ding in the back door. 

The last thing that I will say is that like in any market there are some cheap properties in not so nice areas and very expensive ones in really nice areas.

At least have the decency to actually look at the property and of course we all use the inspection contingency to uncover unknown issues in attics, crawl spaces, basements and many other areas that require a full inspection.

Got it, so nice meeting you as well!

   I have had the same renter for many years now, in a not so nice area.

If he uncovers any problem areas or something that he does not feel comfortable tackling I am going to go ahead and hire someone with a narrower focus.Again, thank you for the thoughtful answers, they played a role in this decision! 

However, I wish I went just to see first-hand what happens in these situations.I say keep following up to see what you can uncover.