Few days ago I had a client tell me "oh yeah so-and-so agent told me X info about this house".. that immediately raised red flags for me.

If their financing fell through for some reason, would we just be back to square one except for me being a few thousand dollars richer for the assignment?

The vacancy rate is high, and if that is indicative of the area, then that is a red flag right there.

At the end of the day i'd probably be in the red about 100/month after being VERY conservative on PITI, and 10% each for property management, maintenance, and vacancy.My income can handle much more than 100/month in the red on this and my rationale is that after "investing" 100/month over 10 years i would have a 500k (conservative estimate) portfolio i only paid 12k for.

I've helped a couple of people contest assessed values and didn't make the connection with the Board of Equalization and equalized value.I love the idea of data crunching on large swaths of information and your use of mortgages (I assume you have an appraised value at the origination date) and HPI are also compelling.Although I haven't played around with it much, because our market is small and pretty homogeneous, I bet I could get just as meaningful information using age and square footage (also available on our tax rolls).

If they say no then red flag would go off

When your retaining wall goes the house is red tagged.

Someone willing to pay a 20% premium would be a red-flag to me. 

No I wouldn't charge them for 10 year old carpet replacement but spilling red wine on my carpet is not wear and tear :) Not maintaining the yard and therefore costing $700 to get it back under control is not wear and tear especially since defined in the lease.

I've been given per square foot cost anywhere from $90-$225, I would like to find a happy medium somewhere in there.