Since this is a bigger project than we have done before we plan on hiring a contractor to do the major work; demo, framing, electrical, plumbing, and sheet rock.

I would strongly advise you to hire an attorney who speaks your native language.

If you do not want to do a syndication, are you planning on starting your own property management company, or just building properties outright and then hiring a 3rd party property management company? 

Once they made me hire an engineer because a support beam had chipped paint.  

I would hire management.

@Thomas J Mele I used Zen business to form my first LLC, however, I did hire an attorney to refine the operating agreement.

Or hire a contractor for $100 - $200 to do what he can to fix it.

Too many stories of how the buyer lost their cash in the deal and the deed was forced back to the owner, should the owner hire a crafty attorney and charge you with fraud, misleading the seller, blablabla all non-sense, and all solved by only doing creative deals where the owner/occupants move out prioor to closing.If I guess corrrectly; this guy is a nut, wishful thinking and you should make a written offer,  based on him moving out prior to closing.  

Costs of furniture, gas/Lyft/Uber, hiring handymen to assemble furniture takes a lot of money!

Before you hire a PMC you might want to read our series about “How to Screen a PMC Better than a Tenant”, since selecting the wrong PMC is usually more harmful than selecting a bad tenant: https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes