Maximizing Sale Value of a "Tear Down"?

[Ben Ballinger]

Hey guys! Before I get into the question I think it's important to have some background: Long story short, my wife and I sensually inherited a property from her father that is 100% paid off. Prior to this I have never owned any real estate property and have rented my whole life. The property has appraised for $270,000. This obviously includes the home that is currently on the property. Originally I was going to rehab the house to live in as a first home, but after meeting with several contractors I came under the impression that this would better be a teardown then a rehab. However, looking at the cost to build, combined with my complete lack of experience with home renovations, it seems like a poor choice to tear down and build myself. That being said, it's in an up-and-coming area and there's a lot of renovations going on by the city in terms of public access way and stuff that is going to probably raise the land value over time. Since I have qualified for a home loan for over $400k, I thought maybe the smartest thing to do would be to buy a fixer-upper that has better bones than this place, say for $250,000 or less, that needs no more than $180,000 worth of rehabs put into it assuming after rehab value will be increased beyond purchase price + rehab cost (aka, a good investment). I have money saved up in bank account already (roughly 100k) to help with overall cost of rehab if I go over loan amount, but what I really want to do is use the money from the sale of my current property so I don't have to use any of my own funds at all. I could sell this property, and use that money for both the loan down payment, for extra rehab costs, and if enough is left over, to buy an investment property for either flipping or renting out instead of pouring all the money into a home that I don't make any cash flow from. I imagine selling the property for enough money to cover the loan down payment and any rehab overflow shouldn't be an issue, but I would like to maximize the sale value so that I have more money to invest in a property. So my question is, how do I maximize the perceived value of this property so that it sells at a high price relative to its appraisal amount? I assume expecting to get the appraised value for a home that is greatly in need of repairs might be overly optimistic and naïve, but I'm not sure by how much. The property contains a decrepit pool in the back yard that would probably need to be removed unless someone wanted to spend a lot of time and effort rehabbing it. The property needs a brand-new fence and the house itself is extremely ugly, and parts of it are most likely not built to code (eg garage literally touching the property line, way past 15 foot setback). Outside of the obvious, such as cleaning the house, landscaping the yard, and getting rid of the trash littered all over the place, is there anything else I should consider? Sorry if this is a stupid question but it's my first experience with this