Forclosure needs extensive renovation

[Denise Tinsley]

As a newbie I purchased a foreclosed home with cash at $22,000. The previous loan on the home was for $88,000. Comps for similar homes that are in good shape would be around $100,000. I have estimated that the cost to renovate the home is $70,000. The home is located in a lake community 15 minutes from a larger town of 17,000. The area is slowly becoming more popular as the Corp of Engineers is adding many upgraded to the amenities around the lake. The larger town is building new developments 10 miles away and an interstate is being built about 10 miles away. The population in the town where the home is located is 2,400. Demographics in the area is  low income ($35,000) average household income, many retirees, but also people who own vacation homes who live in larger nearby cities. My question is should I demolish the house and divide the large lot it is on into two separate lots just to make my money back or go through with the renovation.  I made many newbie mistakes, the first underestimating the repair the home would need. I made the dumb mistake of not seeing the interior before purchasing since it was an occupied foreclosure home.