Most people are willing to make an easy $50, just remember to be respectful of their situation.In our area there is a lot of competition at the auctions and it is not uncommon to see properties bid up to almost ARV and then adding repairs does not give you much margin to play with so any mistakes can cost you big time. 

But I'm want to check out how that plays out with insurance.

Not sure how the "intend" to live there comes into play here.3) As far as I know, the VA is pretty strict regarding the condition of the house you're buying.

The dollars to play in the commercial arena are usually much higher than in res. 

Let us know how this plays out...

@Neil Da SilvaI would say 'history...' because the PTB (Powers That Be) tend to run the same plays, from the empirical playbooks moderne, and ancient, time and again.

None of these homes have insulation and their electrical systems are knob and tube, they have plaster walls so you will be playing chase the cracks as long as you own them.

See http://www.sec.gov/answers/reits.htm Without a clue about your business focus, I'd say take a look at this list of public companies http://en.wikipedia.org/wiki/List_of_public_REITs_in_the_United_States in whatever sector you will play in and read all their S-1 and 10-K filings to get a hint about the business.

It will be interesting to see how this all plays out..what is sad though is the less than honorable house flippers that flip these inner city warzone properties to foreigners left and right and make a killing doing it...

Possibly if you're playing it for appreciation, but even then, it's hard to find a place for under $400k that isn't a condo/townhome with a $250-$400/mo HOA fee.