A good time to consider an LLC is when you have a property or two with substantial equity (for me that amount is $100,000 in a property or two).

Being new to the industry, what would you all consider an entry level investment to get my feet wet? 

Maybe it would be best for you to consider an approach like @John Warren recommended and get comps for each of the houses and then also compare that to the cap rate for portfolios that you are able to find on places such as loopnet.  

I was looking through some properties when I came across a listing for a lot in what I would consider an up and coming downtown neighborhood.

Let me end with this thought for you to consider ... an awful lot of property management companies were started post recession because brokerage was almost dead for 2-3 years.

It won't hit the 1% rule based on your purchase price, let alone the ARV.I'd consider an offer of around $100k, this allows you to hit the 70% rule (assuming $40k of work and $200k ARV).

Even if you end up going the LLC route, I would consider an umbrella liability policy.Tom

Finally, re: changing ownership on the deed, is it still the case that the permit office will not consider an LLC to be an owner-occupant?  

@Ryan HotzaIf I was you, I would consider an umbrella insurance policy to cover perceived additional risk. 

Should you feel they are not providing you with the services & coverage warranted, you can always consider an attorney or public adjuster at a later date.I hope this is helpful.