Also can a contract be drawn between a development firm and bird dog?

Rural Development loan with a 15 day extension if needed.  

It is much like my job as a web developer.  

I personally know of one where the sole purpose of it is to hold undeveloped land -- no restrictions on the use of the property; the HOA is there to make sure that certain land is never developed. 

So, you're competing against "the world" at that point.You're actually better off developing ways to find properties which aren't listed yet - pre-foreclosures, probates, divorce, bankruptcy, incarcerations, etc.My $0.02 ...David J Dachtera"Success is not a destination.

Whats to stop a developer/sponsor from selling the property to himself or another entity controlled by him, at a loss or at break even price?

As for the professional service fees, those appear to be in line with what our development side pays for the design fees of a project.

Our lawyer is concerned the developer may turn out to be a shell corporation that they will close once the house is sold so we have no recourse against them if anything goes wrong.Is it common to require this clause in the contract?

There is a lot of development going on right now, with new condos and luxury student housing.

On one hand, if you want to manage a project such as a flip, you'd probably want to be nearby so you can be there to manage - at least until you've developed enough solid relationships with contractors and such.But, if you want to do turnkeys, you probably won't be able to finance anything in So Cal that would cash flow.