I see there's a wide range of thinking out there on this issue.I'll add that I'm being especially cautious right now because I am in the middle of cleaning up an apartment that is a total mess from a tenant that recently left after I non-renewed them for a variety of issues, none of which were indicated by the prior landlord of five years who gave a positive review (which is making me double down on the prior landlord contact, though that is proving very elusive to find).I have watered the requirements down a bit to basically require 2 of 3 main points: 1 - income 3x the rent (and provable), 2 - current and prior landlord contacts with positive reviews, and 3 - funds available now for lease signing and/or strong credit background.

If you shop around there are some great looking laminate countertops these days and if your talking about 50 units I would be cautious to spend 3x to 10x what is needed.

All I know is I will borrow money at 4% (+/- .5%) over 30 years for as long as banks let me and as long as it fits my COC goals and equity goals (while being very cautious).

Those specific markets are likely to see the exact issues that you're cautious of running into, but these problems are likely to stay specific to these heavy-hit markets.

In short, be VERY cautious about a price per square foot number and only use it for rough, initial estimating purposes. 

That said, being cautious about any investment and knowing that market prices are currently at what appears to be a high point, you really need to make sure the investment you are considering is sound.

Hidden or Excessive Charges: Be cautious of any hidden charges or undisclosed fees that may be added to the loan.

The tenant did tell us they will be leaving end of this month but then she even promised to pay rent and hasn't done that so I am just being cautious and making sure I am ready for what is to come.  

Think of it kind of like craigslist, you can find good things there, but be cautious. 

But even then you have to be cautious, because the law will say the tax authority "may" do something that in reality they never do.I say that tax foreclosure investing is the most hazardous and dangerous way to invest on real estate.