@Aric Van Iterson
I bought a house that I wanted to fix up. It was a good investment, both financially and personally. I learned quite a bit from doing projects on my own and researching different ways to do things. Another thing to remember is the 1% or 2% does not always apply when you are house hacking. Since you are living there, you could break even with you occupying a room and it would still be a great investment. It all depends on what you are looking for and if you plan to keep this house after you move on to your next personal house.
As far as a down payment goes, everybody has a different situation. I used to be a loan officer before I had to take a leave for health reasons. If you put down more money, then obviously your payment will be lower. But you also don't want to drain all of your reserves on your down payment. As far as work goes, I was able to get done what I need to in two weeks after closing and move in, but it was quite a few late nights. At the time it made perfect sense and I received a great return on it.
Another option would be to look at a duplex as well. You could live in one side with a few friends and rent out the other side as well. This would help you cover all the costs and down the road, when you are ready to move on, you will have a great duplex in your portfolio. FHA is also an option on duplexes.
Let me know if you have any more questions.
