The older couple sounds like a pair who can't get their s**t together.  

You should simply be looking for what is a "good deal" now.

Most of my investor clients like to see a potential profit of 18% or more (total cost to buy + cost to renovate + cost to sell = 82% of future sales price).For buy and hold properties, simply try to find something at the appropriate cap rate or better.

@John T.  

More simply put as a buy-n-hold this looks likes a good deal.

If that's your plan, I agree with @Jeremy Pace, that you should simply explain to agent what you want and exactly how much you want to spend to get it.I've learned that statements like "I want a good deal" or "I want something inexpensive that needs work" are too broad for an agent to get a good idea of what you want. 

I was leaning towards building simply because I wanted to 'max out' what the insurance company would give.

Originally posted by @Sean T.

You're going to need to do something to create more value in the property if you want to pull out more following your original 25% down... which could come simply from 3-4 years of waiting on appreciation.  

I find the L-T laws in Washington are reasonable and are landlord friendly or at least evenly balanced.