A 1925's house is not going to be built to the same code as a 2015 electrical code.There are two things to do if you are worried about the safety of the system. 1 - Check to see if there were any permits pulled for the construction of the cottage.

Directly from the Maryland Attorney General:(5) An insurer may not cancel a policy midterm except: (i) when there exists: 1. a material misrepresentation or fraud in connection with the application, policy, or presentation of a claim; 2. a matter or issue related to the risk that constitutes a threat to public safety; or 3. a change in the condition of the risk that results in an increase in the hazard insured against; (ii) for nonpayment of premium; or (iii) in the case of homeowner’s insurance, conviction of arson.Generally speaking a material misrepresentation means the application states there is no aluminium wiring in the property and there is in fact aluminum wiring or the application states the roof is 2 years old and its really 15 years old. 

I am still saving up to buy my first SFR so I am being patient right now. 

Since it is kind of a seller's market right now you probably should be patient and wait for the economy conforms more towards an investor.But when you do, stayas close as you can near downtown Houston and know the market you select well.  

It is true that you would need to fix any health or safety issues or VA/FHA loan wont work.

It is wonderful to see their minds thinking of the possibilities and get excited about the future and I would hate to see it come to a halt due to lack of funding but the reality is that we all have to be patient if there are things we really want in this world.  

One of the requirements to do a short term rental of my condo unit in Miami Beach is to have my balcony inspected for safety.  

It's important to remember that when you see the sky high prices in NYC, SF, LA, Miami, Boston, etc they are being completely distorted by the fact that these are global markets that are benefiting from a global flight to safety.  

Making money for other people is the mindset you must adopt.  3) Be patient. 

I've done a change from apartment to motel, it IS/WAS a tenant improvement project as per building and safety.