Auction/tenant/buy and fix or move?

[Elaine Fawcett]

First of all, I'll state my objective here so I'm clear what I'm looking for. Q: Do you guys think I should take the next week and try to cram in as many estimates and preparation as possible to try to see if this deal is worthwhile, and try to pick up this property at auction? 

Not entirely sure where to put this post as it's really related to so many areas... I'm a tenant in a single family home. I've lived in it for 4 years, so I'm well aware of the intricacies of the house and what it needs to be rehabbed. It's going for auction next week. I had thought for some time about buying the house at the auction (if I could win) and fixing it up for the long term capital gains. My mortgage broker talked me out of it, saying it was best to let it revert to the bank to let them clear the title if there are any issues, and then buy from them after. After reading on here, I see that I can do a partial title search (although time is short) and do a hold on title insurance, so perhaps it can be done? 

In any case, not even sure if will be worth while. I have estimates on repairs based on Home Depot figures and doing most of the work myself. House burned down in the past, it's been sister-joisted in the basement. List below of what's needed. It's also on a private street, which means most buyers will be scared away as the potholes are big enough to bury bodies in. Any estimates I got from professionals were not done with full inspection, but just a brief glance and "guess" - because I didn't think I would be buying it so I didn't seriously do the due diligence.

Comps are $140-160k (although I would definitely deduct from that due to the street issue) - I'm thinking at a high level (haven't run the numbers yet) that if I buy it for under $50k, it will be worth the effort. Guesstimating (gonna run a spreadsheet now on it) that the rehab will be between $40-50k

House burned down in the past. It's been rebuilt, but the old wiring still needs to be removed. Looks like it was a owner-job to run the wires? 

1. there's a short circuit in one of the breakers (an electrician friend says could probably get it all rewired for less than $1500)

2. the drainpipe from the toilet is busted and the landlord tied it up with rope (not kidding) (got estimate of $1k max for all plumbing)

3. The furnace AND hot water heater are on their last legs - oil tank needs a new gauge ($25)

4. radon slightly high 

5. Roof possibly needed next 2-5 years - settling between old part of house 1950s and newer part 1980s is creating an uneven floor inside... could roll a marble from one side of house to other. 

6. pest control problem. Mice and what looks to be flying ants, potentially carpenter ants. Part of basement is dirt, and there are tunnels. I took pictures and don't think it's termites. 

7. Kitchen is garbage, entire rehab, including all new appliances, flooring, cabinets and plumbing (dishwasher is busted and draining into the basement) 

8. Bathroom partial rehab - new tub enclosure and floor needed, maybe a new window in there as it's old and not energy efficient and nailed shut. I'd probably throw in a new cabinet just to dress it up and a folding table for the laundry area. 

9. Floors in the rest of the house are partial hardwood and partial laminated wood. Hardwoods need refinishing. 

10. All old windows (maybe 20 years old), and no insulation in house, could probably get by with what is there, but the woodwork around the windows needs to be replaced, it's ugly, owners children carved the wood and there are gaps where the cold air leaks. 

11. Front door storm glass busted. 

12. Back door needs complete reframing and replacement

13. Two inside doors need to be reframed and replaced, two need to be shaved down so they close. 

14. Outside lights need to be rewired - short circuited 

15. Landscaping badly needed 

16. Deck repair and sealant

17. Porch paint, paint entire house inside

Additional: could put a fence around yard, could add another bathroom to extra-large master bedroom 18x22