Not sure what your budget is, but if you’re looking for an affordable place to get started in and don’t mind a little cash flow, Chattanooga may be worth a look—I definitely second what @Tim Ryan is saying about the city.If you’re willing to venture into nearby states, there are plenty of similarly affordable markets in Alabama, Georgia, and the rest of the Sunbelt as well.

States like NY, CA, NJ, CT, MD, and a few others are states that do not offer a great REI profit if you’re looking to be on a budget.Regardless of budget it still makes more sense to spend less to make the same cash flow.

In regards to PHX for that budget, it's all going to depend on what is most important to you, cash flow or appreciation.

Eliminate debt, establish a budget, and save.

If used tired are in good condition maybe they are worth $1200 retail otherwise if for example the guy gather's a semi truck load they might be worth $50 as a recyclable. 

And if you have to stay low on the budget, a fridge and a microwave might be enough.But lets say you could add the shower and put a fridge and microwave down there and get 100 a night? 

You'll need to be very careful with your renovation budget and timeline.Your renovation estimate of $120k-$150k seems reasonable for adding a bathroom, redoing the kitchen and existing bathroom, closing in the garage port, and doing cosmetic updates.

.- Valuation Improvement: Allowing time for property valuations to improve as interest rates drop.Budget ConsiderationsIt's crucial to budget adequately to navigate projects to a safe point, typically requiring an 18-24 month budget.

At this point, they establish the total town budget.  

Interested to see others experience as I know price ranges and rehab budgets control quite a bit of this.