We all know there are bad agents out there in general, as the bar for entry to the profession is ridiculously low. 

When done do a Journal Entry to the COG (Cost of Goods) sold AccountDon't forget to setup these "flips" as a class as well and link the expenses to that property in order to run a P&L by Class Report. 

Forget outliers unless you actually know and can implement something others can't or won't10/Assign a barrier to entry score, so you can assess that you business is going to be sustainable11/Make sure it is an actual business where you have daily customers/deal flow and not a one per month client thing12/Don't jump on it unless you see yourself still doing it for the next 30 years13/Be willing to do controlled experiments and get feedback from believable people everytime you come up with an hypothesis so you can correct your interpretation of reality.

Or would I need to add a closet and a entry door at the top of the stairs to close off the room?

only locals can tell you how hot a market is because they know it more than others who even do statistics.i would vote for Boston, MA as hot city but the entry point is a bit high.

More of an entry level neighborhood if that makes sense.  

Good cash flow numbers with "low" (compared to SoCal) entry prices are very feasible out-of-state.

We are looking outside the Denver Metro area to get started as the price for entry is too high for our current situation. 

Then in QB, receive the tenant's full payment, deposit to that account, then make a journal entry debiting the pm expense account the fee taken and your real bank account the amount deposited by them, and credit the escrow account for the sum of the 2.

I could literally make more money loaning at 12% than I could buying the asset.So there you go.. legions of people reading on sites like BP  LOW price of entry you can buy notes for under 10k  no license or experience required..