That is SO crucial in my opinion because it gave you the insight into knowing you could invest where others only see negatives and risks. 

Beaumont is part of what's referred to as the "Gold Triangle Area" comprised of Beaumont-Orange-Port Arthur.

You'll need to check to see if you're home in Altamonte is in Orange county or Seminole county to determine the legalities of doing short-term rental there.

Currently, real estate is in a major supply-crunch, and i'm not sure about your market, but 6-something % interest rates have barely slowed us down here (orange county, CA).

I have recently moved to Santa Monica and would like to purchase a residential property to fix and flip that is within a reasonable driving distance from where I am. I moved from Texas so the market is very different ...

Am I missing something crucial to investing in a market like Los Angeles or any other coastal metro market? 

If we are speaking about a fix and flip or hold I would definitely say analyzing the rehab would be the most crucial.

If it were me, I would do my part first (advise tenant to file police report and provide you with a copy of it; secure the keys NOW, ban sister from property, repair property damage) - and then persuade your sister that she really doesn't look very good in orange so she should cough up some damages and make this right. 

But I do think I might have a unique perspective here.I think a crucial thing behind what may seem like a bubble here is simply the mechanics of money.

It's an apples and oranges deal.