Negotiation based on the house's cosmetic issues - smell, colored carpet and interior paint.

And even if he didn't you can use the sq. ft to try to get a good estimation of the repair cost to use the MAO formula for either 65% or 70% category buyers.The numbers look good for my markets, if the home just needs cosmetic updates

I am now looking to purchase cosmetically distressed SFH and fix them up for a better deal.

You have all the cosmetics down but I would do a complete check of all the mechanicals. 

The pros are:1) Very low entry price point (you can buy mobile homes in mobile home parks for as low as $1,000 cash).2) Huge demand for affordable housing.3) Often used as the stepping stone to buying mobile home parks as it's a skill needed in both.The cons are:1) Working around the SAFE Act and Dodd-Frank laws which make it very hard to do mortgages or "rent to owns".2) Older mobile homes, in particular, can need a huge amount of cap-x to but them back into service.3) If you are not extremely disciplined on your background checks, you can let in people who will destroy them.4) Collections is always hard as you are basically dealing with people who have very little money.Here's what you should do if you're really interested in this form of investing:1) Focus on communities that have extremely high single-family home prices ($200,000 and up) and apartment rents.2) Buy only homes from the 1980s or newer that are at least 14' wide so the floorplan is reasonably spacious.3) Choose homes that you can buy cheap due to cosmetic -- and not structural -- issues.4) Watch over your home renovation costs closely and cut every corner -- every dollar you spend is a dollar less profit.

Also I am a huge proponent of buying an existing townhome where you can make cosmetic updates for forced appreciation to help your cause. 

This type of damage is typically cosmetic in nature and may not necessarily indicate deeper problems.

We have a list of projects for the next two years which is mostly cosmetic (got lucky, no 2 x 4's needed). 

The language is intentionally vague (really anything can be argued to be major), but it tells the seller you aren't looking for cosmetic repairs.

Minor cosmetics