If they make claims about rehab costs, make them provide WRITTEN bids from contractors.

My opinion is he will not and he has forfeited the deposit in place of rent.Do nothing, if he calls let him know how much rent he owes you for not giving notice and tell him you will be taking him to small claims court if he wishes to fight the fight over the deposit.Personally I take the position when they do a midnight run is they forfeit all their rights but just wait and see if he calls :) . 

I've seen his interior renovations and insurance claims, and he's also done a few tenant buildouts for me.

hi my name is victor i have been interested in real estate investing for a while now and me and my wife are currently looking for our first personal home. we are thinking about making this home kind of a long term flip. we want to buy a home in a location where most people around here want to live renovate it in a way that would attract most home buyers in our area  i would like some advice on : how to analyze our current market to find out where people generally want to live what houses are people generally looking for what renovations get the best return on capital 

Don't forget though that the moment you begin claiming this rental income on your taxes you will actually see more profits.  

Of course it is possible they are all wrong and breaking the law, but I'm doubtfulIt is possible to operate a wholesaling business as a sole proprietor and claim all of your income on your personal taxes.

Back ground of issue below from SellerPertinent facts for analysis: My wife and I acquired the properties through a quit claim deed signed by N**********, manager of McGinty Land Co.

I have the buyers sign and notarized an occupancy affidavit to protect myself from an owner-occupied claim down the road.  

Also your claim that "cash flow and appreciation are not inter related" is ridiculous.

Having a w-2 related to real estate won't qualify you There was just a tax  case with someone who worked for a mortgage company and tried to claim RE professional and it was tossed by the IRS.