Would this be something an ordinary inspector would be able to judge or something I can look at and tell by visiting the location?

There are a couple small things I see, but nothing out of the ordinary for anything you might buy that is pretty new. 

I found one going up for auction in my neighborhood later this month and I drove past it this morning to check it out. looks like it could be a good deal for the right purchase price. only problem I'm having is there are cars in the driveway and patio furniture on the front porch.

The imputed interest rate rules prevent sellers of capital assets from increasing the selling price to reflect the equivalent of unstated interest on deferred payments which converts ordinary "interest" income into long-term capital gains.

But if it's been a true flip in progress you'll have to pay ordinary income no matter how long you have owned it. 

Let present the numbers:Home appraisal $160,000selling price $120,000time frame to be purchase no later then 11/22they are leasing it to me for $100 a month all included untill 11/22 this unit is also next door to my current rental. it is a 3 bed 1 bath, 1400sqft, 2 garage garage, concrete drive way, concrete patio, white vinyl privacy fence, with relatively new windows, flooring, and everything was well taken care of through the years.

The backyard will be ready two months after the renovations on the inside are done.there is a small patio that is attached to the house that I can give access to if somebody needs to go in the backyard area.

Such entity in the ordinary course of its business must be engaged directly in real estate management or development activities.2) Expenses related to the real estate will be paid by the corporation.3) The real estate will not be used for personal use.4) There may be periods of time when the 50% test described in 1(a) above is not satisfied.

Simplified:$620,000 ARV-$370,000 purchase-$TBD closing costs-$52,700 Selling Expenses-$89,000 rehab costs-$24,660 loan cost- $TBD holding costs (insurance, utilities)- $5,000 misc= $78,640 minus whatever those TBD costs areYour profit will be taxed as ordinary income.

Refinish the porch railings or spruce up the patio with some furniture and decor for added appeal.