Rent for the area is around 600-700/month, but there records show they consistently get around $225/week, which appears to be much better returns.

While the sale side of the market appears healthy it makes me question the long term trends and where we are in the cycle. 

There was another recent thread about service dogs, and it appears that according to laws/the Americans with Disabilities Act, that a service can be any dog either trained or in training to do special duties.

The other unit needs the carpets removed and sanding of the hardwood floors, it appears that's it.

If at anytime the person paying the property tax, appears to be an individual and not the bank or the bank's agent, or mortgage servicer etc., it can be assumed the homeowner haven't been foreclosed on yet.Someone is paying the property taxes -- either the homeowner or the bank. 

AlexI'm familiar with the term "cap rate" for valuing apartment buildings (5 units and greater), but you appear to be talking about single family residences (I.E. 1 to 4 units)  What do you mean "cap rate" for these? 

The numbers appear to be good but I want to get your take on this to make sure I am not missing anything.

It sounds like you've done a thorough analysis of the financials of this investment opportunity, and it appears that it has the potential to generate a good return on investment based on the estimated rental income and expenses.

The goal is to make it appear that someone lives in the home.

I appear to be in good shape.