As a result, the agents are usually handling large quantities of properties just to be able to make a living.  

As a result, with respect to Mississippi, the property may be Struck-off to the State--which now places the property in another category. 

I have been using this loss to offset gains produced on previous property sales.

Timing is very important as bankruptcy filings can invalidate auction results if it was filed at the right time.

The lower demand markets, ie older homes or less desirable areas, should produce a higher return.

Some have followed this and produced great answers.

Depending upon where you are in PA, zoning and land use may not be a problem, but apparently there are lots of hoa's that sue and or get sued as a result of common issues, so insurance can be crazy expensive  or prohibitive.  

If you're going to resell you should have the place tested by a professional for mold after you fix it up and make those test results available to prospective buyers.

Don't let personal opinions get on the way, ask for an approved change order, if they couldn't produce it, play hard ball, after a few arguments, draft what you want to pay, and let them know that this is only what your paying. i lost 50k on a job because I didn't have the right paperworks, and there's nothing i could do, so i know what it takes legal wise.

You will have to discount it but at least you will have or he will have some money to move on to a deal where he can make a better decision and selection of a property that will produce a better outcome from a profit view point.