Regarding your other questions:  - If the going value is $260/SF, why would you pay more than that?  

You can probably pay for a course when one of the sucker roadshows comes thru town, but it is a ton of money. 

For example, I mention that every adult must pay a $30 application fee, pass my credit/criminal background, make a combined income of 3x the rent, and whether or not the property accepts pets.

We almost went with a loan that we have to pay all the cost upfront and then get reimbursed on the back end and that was just not something we were willing to do.

That will increase your material costs for the job and is the contractor paying for the material in their bid or are you paying for it and paying them a labor cost.

But I would not consider what the seller needs to make in determining what I'm willing to pay for a property, especially when youre buying a problem like this.

Somebody somewhere had to pay for that real estate at some point and has continued to pay for it since.

You can't directly do something to allow you to sell the flip, and buy the triplex without paying gains. 

The guests refused to pay.  

Purchase price: $275,000 Cash invested: $294,000 Sale price: $355,000 Seller was behind on pay HOA payments and in risk for losing the property.