@Katrina Nicole-Ivy can you post the address of the one you may keep? I own two in Baltimore, purchased in auction like you--pictures only, other than that, sight unseen. After winning, my partner and I went to check them out and decided to take the $2500 deposit loss on one of the three we won (hence we only have two). The ones I purchased are over 100 years old: immediately had to replace a roof for $5K, next the boiler for $6K, there was a flood in the basement last winter and I had to put in a sump pump and replace the hot water heater since the flood got so high (another $2K)...all of that before even being able to rehab it to increase the rent. The other property only had a $600 issue with the furnace.
The hardest part of my dealings in Baltimore are that I live an hour away and it seems almost impossible to find a contractor. My plumber charges more, like way more, to go out there and my hvac guy won't even consider it, so I had to pay way more than I like for some of those repairs since I couldn't use my normal people.
I say all that to say that as a first investment, I would caution people to stay clear of auctions unless they are comfortable with a surplus of reserves because its very difficult to assess how good/well maintained the major systems of the property are from photos. When I'm finally able to rehab the one when the current tenant moves out, I'm not sure how I'll even go about finding a contractor to do it and I don't even want to being to think about how much that would cost retail.
Some things I picked up along the way:
Many house in Baltimore have lead paint issues. They take them very seriously. Research this, thoroughly. Not to scare you, but it could present financial ruin for you if ignored or handled incorrectly.
Check out trulia for crime stats. Baltimore like most cities varies not just block by block but end of block to end of block--one end of the block can look like Sesame Street and just ten houses down can be a war zone.
Be aware not just of the house you are interested in, but also note the number of vacant/boarded up homes on that block. Most people don't want to live next door to a vacant and could present a problem with finding a good tenant.
Don't trust sites like zillow rental estimate (at least for Baltimore--I've found it to be more accurate where I normally invest)--you will have to do a lot of research to determine what a house will rent for using a variety of sources.
Look into purchasing the Section 8 Bible. You may not plan on going the Section 8 route--I didn't. But I found that a lot of the concepts in that book apply when you purchase a house in a class C or lower neighborhood. The authors, I believe, invested in Philadelphia, a city comparable to Baltimore.
Also if you can't wholesale the $12K one you intend to keep, definitely make the trip to check it out in person. Instead of losing $4K, it may be possible to salvage that one, do enough to make it habitable and find a renter on the lower end of the price range that will cover your loan servicing. Also, I'm a licensed realtor in Maryland and DC and can list it for you if you complete the purchase--you may be able to sell retail and get all your money back from the sale if the wholesaling approach doesn't work out.
If I can be of any assistance, shoot me a message and best wishes for you investing journey :)
