But since then the auditor determine only half of the items needed to be fixed and were now my deductible.

It sounds fine to me, but I don't know how I would pick a cap. 

I'm basically trying to determine if I should remove Friendswood from my potential markets and just focus on Pearland.

Harris County is providing a free presentation to correctly determine floodplain status of a property.

Its not Sexy or fast , but it will get you there, and many to pick from in many markets.

And I just read some things about insurance companies not covering losses if they determine your house is either vacant or unoccupied. 

I would also love to connect with an experienced investor in this market to pick their brain, so please feel free to connect with me on BP.

Even if you're picking these properties up for $50k each, you'll only be able to get 2 of them. 

I'm sure there must be a reason you are picking a place thousands of miles from home to invest (not what I would suggest) but - I would travel to the area, spend a couple of days getting to know the place, and attend a REIA meeting to meet some fellow investors before I'd through a bunch of money at it.

If they are getting a loan then let their bank determine the requirements.