Has anyone else done something like this or is this a terrible idea?

Most people are terrible painters often because they don't do the necessary prep work.

Not to totally burst your bubble, but I wouldn't count on a crazy appraisal- if this is a new build, appraisers don't usually go nuts on valuation, their primary goal is to make sure there is value there for the bank to finance the purchase price, so it's not often they go terribly far over that, even if there is obviously more equity. 

My question is regarding the “gap period” when a house is foreclosed on and the city fines the house for looking terrible (overgrown grass,etc), who is responsible for taking care of the fines (and the lien that was placed on the house for the $50,000 fines)? 

All I know is how to run the comps to make sure I'm not making a terrible decision.

The lower barrier to entry down there is appealing, but I don’t wanna end up with terrible tenants.

Your best solution to reducing that risk is screening the tenants yourselves, which isn't that terrible. 

I did this recently and had a terrible experience.

The world is full of habitual losers who are simply terrible at systematic problem solving.You can't go into self-managing rentals on a wing and a prayer, as far too many people do.

@Elizabeth Schartman any of those unattended showing software programs are a terrible idea.