If you’re not interested in managing it interview a few property management companies and pick the best to manage it for you so you don’t have to deal with maintenance and tenant issues.

Usually one would think that Tenants are were the liability and issues arise and although there will be issues there, they are all quite simple to handle however, owners can certainly get you in trouble from a liability standpoint.

.- Current tenant's history/profile - Public record information pertaining to complaints, open permits, liens, etc. against the property- Current Zoning of the property and surrounding similar-sized lots- Sales comps- Market stats i.e. average days on market for sales and rentals, vacancy rate- Rental comps including price per square foot (ppsf) reports for recent rentals ..

Back then the city council was discussing a limit on the number of str permits.

You can identify risky circuits this way if you can anticipate how your tenants will use the electric and take action before there is an issue.

When we purchased this property, it was run down and had major issues to fix and there was an additional .34 acre parcel of land included with the purchase that is located next door.

.- Copies of all required permits pulled for the scopes of work.

Very likely the original listing had a room addition, probably a garage, that was later removed due to illegal build without permits. 

What other scenarios could I possibly run into besides property value decreasing that could cause issues?

I see this occur on both spectrums:I see this very often during due diligence, where an investor will either perform a Google search thinking they know some statute or some law, then proceed with trying to fade the bid - even though the seller has had an attorney on the case for the past six months and can confirm there are no issues.