However, it needs some updating, a new roof, and I'm worried about the "seepage" issue into the basement.

Although, we want to make it easy for sellers, do we ask them to do more legwork in lieu of a walkthrough, like telling us up front if there are any major issues with the property like foundations and old roofs, uneven floors and rotten subfloors?  

how much do you have set aside for an ac/heating water heater roof. 

House is from the 60's and has a 15 year old roof.

Fix hvac, water heaters, leaking of water depending on the degree of it.  

During the inspection period I found two major problems with the property.. some knob and tube in the basement (all new electric work other then that) and an asbestos roof that a roofer gave me an estimate of low end $20,000 to fix.

roof?

New roof, flooring, bathroom and kitchen as well as brand new mechanicals.

They will temporarily ignore remodel permits but will approve roof repairs, water heaters, plumbing repair, etc...Before any of this, our city was having a meeting about housing which is an ongoing issue in our tourist based local economy.

I ran into some tenant issues with squatters that has slowed down the rehab process, so far I have only completed two units and the roof.