Should I Rehab or Build?

[Daniel J. Gibson]

I'm relatively new and am interested in accumulating rental properties in Central NJ.    I'm currently looking at a house in Raritan, that is in very bad shape.   It is a small property, about 1,100 sq feet, built in the 1940s.    Very poorly designed compared to today's standards.       Other than, some new windows and staircase bannister, no upgrades have been done since the 1940.    No joke.    To boot, basement has a lot of water damage.      At what point do you say that a property can't be rehabbed and you're  really better off demolishing it, then starting over with new construction?    Property is in a decent neighborhood, in a very good school district.      Number one, as a newbie, should I call it a day and move on to other opportunities?   Number two, would you recommend building from scratch or going modular?   Lastly, any new home builders and/or modular home builders in NJ who would be interested in a project like this?     Thanks!