the cause of the issue needs to be addressed as well as a complete repair of the results of the leak. if it has been 3 weeks, mold most likely is not going to be an issue. most black mold will start to grow within 48 hours and certainly by 3 weeks would be very evident. there are 18 different species of black mold and only 2 of them are toxic. the chances of getting the toxic kind are slim, yes, but still possible. a reputable company such as servepro  certainly could leave you with no worries in the end

Are the banks holding these REO's deliberately keeping supply artificially low in the hopes that their toxic holdings end up booking some profit?

And remember the US has some of the lowest energy cost on the planet so they folks in Europe and Asia who pay much more for their heating/cooling energy use them because of their energy efficiency.

Or would informing them sooner could turn the relationship more "toxic" sooner and invite more troubles?

I can vouch for @Jay Fisher - he's a great guy and we'll miss him here in the most amazing investment market on the planet!

A few key points. 1) this stuff is toxic and can hurt you or worse (be 100% sure you buy respirator and have fresh air blown in) and only do it in unoccupied unit. maybe worst (toxic) stuff I have worked with residentially... bugs were dropping dead by the window...2) no it is not forever permanent--but what it is. 3) prep, prep, and more prep. 4) I would use it on a surround that gets some water splash--not where it gets constant water or submersed (like actual tub, need heavy duty stuff there). 5) follow all instructions and research well....cheap (25-30 bucks + roller)--but a lot of prep labor. it would make the surround look nice enough for the sale and/or get you through a few tenancies on a shoestring until you or someone replaces it.

Nobody wants to see this market turn in to something toxic, and if you read PandoDaily there's been some good reporting on worst-case-scenarios just in the last week.

Then I would put my attention to the least damaged of the other two units, even if I had to use the cheapest flooring on the planet.

The weather in SoCal can't be beat anywhere on the planet for 12 months.  

It's natural, awesome stuff to kill pests and isn't toxic.