Most municipalities in Alabama require a business license for long term rentals, also.

Typically 25%+/- down payment is required.

Tenants frequently do not take good care of the properties, and the government requires certain standards for the condition of the units.

So if you can find a parcel that doesn't seem to have multiple fatal flaws, or at least you think you can add value to fixing/figuring out their constraints, then I would do that and then just flip on the MLS, especially if you are able to let it "season" a bit, which the title companies in California require anyway...they won't insure a flip of a tax parcel until some time has passed.

Building on a lake requires experience with the locale and building regulations.

I'm not aware of any lenders requiring 50% down.

What are the requirements for an owner to hold an open house in Texas?  

It is not fraud as long as you live in the property as long as the occupancy affidavit in the closing docs require.

Landlords are required to disclose that the property is located in flood prone area and/or the property is known to have been damaged at least once during the 5-year period before the lease.

For owner occupied properties federal law requires lenders to verify the ability to repay by the borrower.