Lol, I sidestepped that objection and asked what their price was and availability was, and just reminded, "Well hopefully your price can be competitive."

Overall, from what I read The objective is to make sure people are coming, staying, and getting paid. 

Bleach is good only for changing the color of the mold and watering the roots of the mold.CHLORINE BLEACH IS INEFFECTIVE IN KILLING MOLD FOR THESE REASONS: (1) The object to killing mold is to kill its “rootsâ€.

My main objective is to buy properties (preferably SFH for my first deal) with strong cash flow (looking for 6%+ cash on cash return), with some appreciation on top, which I know is challenging in the Bay Area.

Depending on the area your property is in and if nearby residents may object to the rezoning would depend on my suggestion for you attending in person. 

Hence they accomplished what you claim (claim above) is the only objective.

Their objective is to get it sold so if they can lower price then it will make it attractive for some buyer out there.HUD posts bid results but it is not helpful unless you can see more historical results over wider time frame and it does not relate to actual property sales price or details.

Avoid the "shiny object syndrome" by narrowing down your niche as soon as possible.

I know you can read a lot of doom and gloom and know a few people personally that leave and it feels like its a huge trend... but objectively its not. 

If money is your objection snap out of it, the deal holds more value.