Because of the change in plans along with some unplanned rehab costs, I likely won't have the funds to rehab both houses up front (although I can find additional funds if needed).I read about Fannie Mae's "Delayed Financing Exception" which looks like it may be an option for this property.

We are mostly concerned with putting a high quality team together from the start so that we can minimize the prospect of running into challenges later.

Long story short, this delayed closing by a few months, $1000's in legal fees, and we only got the fines down to $11K.  

For your first deal, buy something that needs minimal work, just to get your feet wet. 

But I disagree with that being the best course of action.If your goal is truly minimized risk, then leveraging up to buy a commercial real estate property is not going to be the best use of your money in my opinion.  

At some level, I imagine you still like the area as well.2) If you actually think the sale is the better option then what is your window for minimizing capital gains taxes?

If that is what the market holds, yes but, if the market in the area is 90 days, and the REO stigma is minimal, denying a short sale at a 20% discount, taking the property into REO and preparing it for open market.

I'm brainstorming to come up with 15% to try and go conventional and also found a nice sfr I could pick up for around 100k and put minimal into and get 15-1700 a month.  

Just like we all know the term "Gaper Delay" when there is an accident, we all have to slow down and look to see the damage and "goriness" of it all.Media has to sell air time to pay all the staff they have, so they will report what sells!

Thanks for the perspective.As for developing: 1) Make sure your money is solid (you don't want to run out midstream or if a delay occurs...and something always delays you)2) Get to know your local governing body (County Commissioners, Building Dept., etc)3) Don't overpay for the land.