There also has been some new very competitive houses around the area that have more living sq feet for less money. 

Common practice is to make money when you buy or you made a bad deal, so if he desn't know what money he is making from the start then he doesn't have a good plan and I certainly wouldn't follow it.I know housing is tight in the Western US - WY, ID, MT, ND, SD, UT etc etc so housing will come at a premium of some sort (price or competition etc).

I think this could drive down rents in that sector creating competition in the B and then C sector.

  I understand that once a property is listed, the competition grows, and the pool of people with awareness of the offering increases... but this one just went live, fits all his criteria: the price, the CAP rate, the potential upside, the cash on cash, it all fits.

i have been getting some from a realtor but the MLS seems to have competition 

My competitive advantage is leveraging our partnership and looking for the properties that other investors don't want to touch. 

If there's not a lot of competition buy the ones at the end of the auction. 

The other question is how competitive your rent will be.

Yeah you live in a dense area population wise and it can be competitive in the housing game.

As long as the media keeps pumping "high" unemployment and "declining" population, we will be able to have a field day with no competition and very undervalued deals.At the end of the day wherever you're looking to invest make sure that you have established trust and relationships with key people on ground that will always have your best interests at heart.Don't become another foreign investor succumbing to shady operators here in the US.Thanks and have a great day.