We've helped many local homeowners keep their homes out of foreclosure simply by getting a housemate or two....it isn't easy but it works.

Or it simply is not worth $80k.  

The seller of the new home simply waits for the other property to be sold to collect the amounts due them.These are conventional approaches to bridging funds from one property to another, not a screwy thing to do.

Syndicator put the deal together end-to-end (finds deal, negotiates, closes, sets up LLC, works with lawyers/banks/accountants/management companies, etc)I have a good relationship with the sponsor and am simply looking for an opinion as this doesn't seem to fit your traditional syndicated deal structure.Thanks!!

Unfortunately I highly doubt that the building department will be of help in attempting to resolve this, unless you meet with the head of the building department, who will then likely just tell you more or less what I told you here). 

They do so in attempt to sell them outside of the auctions thus getting closer to a retail value for the property. 

Is cash buying simply a means of making the transaction happen as quickly as possible or is it completely necessary?

They could simply put the money in as a loan to the company with a market interest rate that you paid back to them.

I did some more digging and research on the internet, and I came upon a comment on a youtube video that simply said...

Some people attempt to build a business out of this, but I dont think that is really sustainable.