I get to do the part of the gig that I love, which is creating and building beautiful things and I still have time to evaluate and look at deals.

I have actually partnered up with a good friend of mine who worked construction for 12 years so I'm just having him evaluate rehab cost.If you don't know any contractors what you can do is go to your local Home Depot and take notes on prices of raw materials.

If you have experience with this model, please respond to my questions below and provide any other input that would be helpful in evaluating this strategy.Have any experienced investors on here rented to seniors under specific state government programs to maximize rental revenue? 

Generally, they will require an evaluation of the work to be done and a quasi appraisal of what the property will be worth, once it is complete...an ARV.  

It seems like there are always a few outliers as far as a really high or really low evaluation on rent when looking at Craig's list.

How do you evaluate a renters ability to pay if they have a non working girlfriend and child?

If you plan on occupying one of the units, evaluate the property both as a pure rental (income from all units) and as a partially owner occupied property with income from the remaining units and any applicable owner-occupant reductions in property tax.  

As long as conservative numbers work taking into account the increased cost of hard money, then don't worry about it.A hard money lender can be a second set of eyes on the deal and can help you evaluate it.

Con - if I decide to buy it, I may be forced to make repairs that in our evaluation do not need to be done.

@Ford Smith  the one thing I would add to the above is thoroughly evaluate if you decide to move and evaluate it  financially for both of you.