Also, maintenance costs are almost non-existent in the first few years as very little (generally) goes wrong in the first 5 years or so.

For this product most lenders will go off of the purchase price plus your rehab cost for a conventional loan.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

How much would it cost for material and labor for a 985 square-foot house?

A few things to consider: are you increasing rent each year to at least try to recoup some of the additional costs (everything goes up, so why should the family member not pay more-if it is your parents, it is more complicated), how much has the condo appreciated over the last 3 years since you bought it, and what would you do with the money when you sold?

Increase your knowledge, experience, then confidence - go for it afterwards... get as many as you can handle or create a automated system to handle for you.

Insurance would cover legal costs.  

Low cost, surprisingly beautiful home for the money.

If you buy a turnkey property you have very little chance to force appreciation  so you have to wait and pray for values to increase (not good).When you run your numbers in AC remember to leave wiggle room for flood insurance most of AC needs it and increase your turn over budget for when tenants move out. 

However, since this would be an investment property (held for 1 year or less), ARS 32-1121(A)(6) requires all work be performed by licensed contractors if the cost of material and labor is $1,000 or more.