Any residents with valid green cards and work visas can qualify for a U.S mortgage.

These deals are attractive to investors for the following reasons :Contracts to build 3-4 bedrooms are available under $300kRental Comps from $1600-$2200 / monthWarranties:10 Year structural 2 years electrical, plumbing and HVAC5 year warranty on the hot water heaterTight market with low inventory.

I think that your concerns about not having equity in the property after a year are valid.

I kept my home warranty active and did not add that cost into the rent.

But yes, there would still be a higher promote to the sponsor so your point is still a valid one. 

How tough will it be to turn a Quit Claim into a General Warranty Deed?

Three things that would concern me if I were in your shoes.1-$30,000  would almost re hab another property in bad condition.2- Make sure the inspector does a really good job.3-Have owner or seller give you a one year warranty on property.

I searched the tax rolls today and see that, in fact, my wife is now listed as the “Special Warranty Gift Deed” holder.I don’t understand how this can happen without my wife having signed or even really agreed to accept it.Thoughts?

the more expensive new options or try to find cheaper used ones that won't have a warranty? 

I don't have any knowledge of the Canyon Lake, TX market so can't speak to whether it's a good market or not - @Nancy Bachety brings up very valid points re: making sure the $250k purchase price will be competitive with other STRs in the area that are bringing in ~$40k annually.