@Curt Davis of course you are right but the anxiety level and cost factors are what keeps me at home.

You are being conservative underwriting to the future, when you don't occupy it. for the present, you must factor in what you would be paying in rent. 

If they are only lending 50-65% of the current value, the property will be the most important factor in their underwriting decision.Not having money for DPs is usually a symptom of other things.  

@Shannon Sadik There is a product that we use, it is called Kilz, we use them even for fire damaged room, factor those out and the painting expense and embed them in your contract.

Do you still factor in the “rent” of an owner occupied unit when calculating the value and other valuations?

Most designs before 1970's don't have enough seismic load factor, so they are weaker than today's standard. 

The janitor expense seems interesting as well as I am not sure who charges $33 per month to clean a common area...Here is what I would guess the building really looks like:Gross income minus 10% vacancy factor= $148770NOI using the 50% rule= $74,385True cap rate then would be 11.4.

I would also factor in concessions, and bad debt.

Based on these factors (and the fact that I am new and would prefer cash now to do more deals) I am leaning towards flipping the home.Thanks again. 

It's all factored into the contractor's bid.