You can always increase the liability coverage, or purchase umbrella policy as mentioned. 

In that case I would not mention offer price without seeing their financials first. 

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I agree with a couple of things already mentioned: DIY or hire someone to do regular perimeter spray in each unit quarterly.

@Brett Snodgrass so happy to hear u mention craigslist as a potential lead source as I been on there plenty lately trying to weed out the good from the bad.

Late January, we get it rented out again.Between the process of eviction and the slowdown due to the holidays, it seems entirely possible that we'd miss out on 3-4 months rent by going with scenario 2, not to mention the expense and hassle of the eviction itself. 

Not to mention we cannot afford anything over a total of $350K, so sure the numbers would still work for $220K but then we couldn't buy it lol.

You just have to look a little harder.You didn't mention Kansas City.

Preferred age of unit is no more than 40-50 years.

FYI, I flip locally in the South Bay market but cannot find the above mentioned buy and hold  matrix here.