Plus, don't let them dictate the due diligence. ( they're human).

The condition of the property will dictate whether someone would consider it a slum or not.  

I totally agree that one transaction doesn't dictate whether a person knows how to succeed in investing, because so much could turn a winning investment into a loser and be out of the control of the investor.

What you buy today can dictate what you are able to buy in the future.

Obviously the size of the lot will dictate how many units I could ultimately get in there but this zoning designation is pretty crazy in what it allows for developers to do.

@Or Yeger  quality first you will pay differently for in different markets..what your looking for is Yield the Yeilds will be dictate what you pay for the note.Many quality performing notes that are say 7 to 10% will be sold at Par.In my ever it to be humble opinion buying a note that was purchased as a NPN and is no performing is very risky.. the chance that you will be right back into NPN status is pretty great probably 50% chance or better.I like performing notes with good solid borrowers not notes were the borrower has already defaulted as they now know how its done.. plus ower occ notes have all sorts of rules and regs you have to follow .

If one uses realtors to sell, pays closing costs of all parties to buy, has hard money costs, and holding costs they typically make 10% profit on the sale.There is and can not be a new model of 80% for a rehab flip when the economics simply dictate there is no profit left for the actual party that takes possession, risks money, risks loss, risks vandalism, pays for insurance, has holding costs and actually adds value to the property through repairs.  

That is why supply and demand dictates a certain return.  

But local custom dictates these things.

Your lender may have other in-house requirements dictating the 30%, so you might want to check around for other lenders.