Also, some base their offer price on the repair price (i.e., $50/sq ft - seems too low), which makes no sense to me.

@Jordan Myer she is asking to lower it base on market on the area since it's been declining.

Your P/I is based on the amortization period during the balloon term. 

Do you buy assets based off of the financial data on that other asset.

It is a quick synopsis of what to look for based off of my experience both managing properties and talking to other investors which have hired management firms.

I would love to get a better understanding of what duplexes in this area actually sell for, and not just running my numbers based off of initial listing prices from owners.

The rating was based on the Executive Supervisor payroll and the cost of the Subcontracted work. 

Based on these rough numbers and assuming that a market rental appraisal would back up your stated income, you're looking at a DTI of ~44% at today's generic rates.

Here's what auction.com said about the transaction details: "Buyer will not be charged a Buyer's Premium for this property.If you are the Winning Bidder, an Earnest Money Deposit of 5% of the total purchase price or $2,500 (whichever is greater) is required.Buyer may receive a Special Warranty Deed or equivalent if Buyer is able to purchase title insurance without delaying the closing (title fees typically cost between $500 and $1500 and are based on the purchase price of the property).

I'm based in Virginia.