They also probably wouldnt be happy about this setup, so there would be probably be fight with them over-stipping the file. 

Are they going to just place a lien on the lot and bill me for the demolition cost or should they bill the owner for the cost as I don't own it and only have the tax lien? 

That said, deductible would likely be $500 or more so how many nights would they need to get a hotel for instance and what would it cost?

Well besides the hard costs (construction, materials) and soft costs (permitting, architecture, fees, engineering) people often forget holding costs. 

. - Costs and Returns : In overly general terms the cost of doing business in Oregon, (especially on complex property types) is more manageable in Oregon in comparison to let's say...California?

You need to factor the cost of refinance (average $7K which may change depending upon the price of your home)

I understand I have to find the right loan and do the math, but is there really any other downside to the FHA and that additional insurance cost? 

Which one of the paid lead generation sites are you finding most effective for getting lead lists and which mail houses are the most cost effective? 

It is only fair that you pay them something in a situation like this and you need to consider what this is costing them not only in hard costs but in the inconvenience and lost opportunity.

While mortgage rates are a non-issue for you, the challenges of rising insurance costs and market fluctuations might deter other buyers, potentially lowering competition and prices.