Look at the permit.  

He doesn't put any money into the deal, he oversees the design, permitting, construction etc. and adds 18% onto the construction costs.

Some things I've thought up so far:county zoningcounty building permit processeasementswater table (there's no water/sewer/electric)But really, short of talking to the listing agent who I imagine is primarily motivated by sealing the deal, I'm not sure what sort of due diligence I should engage in.

I just read the first post and if you can get a roof done and permitted for $4,000 I'm investing in the wrong state.

90% of real estate rehabs are done within 2 weeks, with proper permits I have done it for 3 weeks including all inspections.

Some cities are more strict then others with permits. 

Make sure to look up demo permits and costs.

Check for any building permits done.

In fact, there were two code violations that I was made aware of at the closing (so money was held in escrow for the repairs) but there were several more I was not aware of until I went to get permits for the two that I did know about.

You can also check to see whether the property has any existing code violations, what permits were pulled, even whether the 2-family is a permitted use (don't assume that it is).