They see real estate as a pure tax write-off hobby.I consider it a pretty good deal - two properties are located in areas that are active and sprawling - one property in particular is situated next to a massive vacant lot (where a factory once stood, but was demolished years ago) that has been bought by commercial developers who have released plans to bring a large grocery store, along with shopping and eateries - I know this information because, well, just trust that I know.

I am new to real estate, but from pure business point of view: option 1 gives you a bit better %, but you giving up more cash that you might use for next deal.

I always felt like this is a strange looking house, and with these options, I'm sure we can radically change the appearance for the better.That being said, the 10K number was purely hypothetical, and cheaper is obviously better.  

Buy it, move in, fix it, house hack it, then after awhile buy another to move in and turn it to a pure rental ... rinse and repeat as necessary until filthy rich. 

Scenario 2 (Streamlined FHA Loan):Can you use a streamlined 203k loan purely for the 3.5% down payment?

I'm not familiar with the term "law day" you have there, but assuming the actual foreclosure sale has occurred, the bank took it back, and any "redemption" type period has expired.....the bank owns it, pure and simple.  

Don't get me wrong this will be a challenge to manage, the area is not suited to appreciate and this would be a pure income play.

@Bryce Lowe-WhiteYou can't flip a pure flip rehab. 1031 isn't for short term gains.

You guys are all right, the running theme I have been seeing is that first put in your time and learn the trade before jumping head first into pure investing.

My current property manager does not want to deal with a mobile property.Also the management costs of the tenants, who may not be blessed with secure income, or may not be in a position to automatically deposit the rent on a predictable and reliable schedule.I am only looking at pure cash flow, as I don't intend to flip the properties.My head tells me that lower end properties yield much better cash flow numbers, but my gut is not convinced or ready to take on the unknown management costs.