I had a roof where we replaced 6 shingles and because they had not laid down and adhered to the layers below the inspector determined the roof needed to be replaced.  

So by understanding how much cash flow you need will determine the types of deals you target to purchase.As a CPA I always suggest forming and buying property in an LLC as it gives you flexibility from a tax perspective and also has legal protection.

Works, but the contractor has to be involved (and knowledgeable) in determining ARV/ margins.  

sounds like a good ideaCurrently I am try to determine if CCIM licensing would help in my market.

Not to mention being able to estimate the amount of work needed to determine what the maximum allowable offer should be.

Also, if your seller cannot post bond and its determine one is required by judge, your seller will only get limited powers and your intended sale is now subject to overbid in open court.Lots to know; lots that can go wrong, and much to learn about to control and work these deals.

Once you have selected specific areas within each of those markets, determine which one has the higher likelihood of finding motivated sellers. again, flipping isn't a hobby, because - unlike buy and hold - you absolutely have to get close to the 70% rule to make any money.

There are several factors at play.First off, you need determine your max price before you get caught up in the emotion of the auction. 

My question is how do they perform the due diligence to check out a property to determine if it is a worthwhile investment ?

I think you are best to call the city and find out how helpful they are or are not and that will help you determine a course of action.