Also you should inquire with insurance agents about the cost to insure.

Here are a few to watch out for:Property Condition: Most distressed properties need extensive repairs or renovations, which add to your initial investment.Competitive Market: With Phoenix's popularity among investors, competition for the best deals can be intense.Complex Deals: Foreclosures, auctions, or short sales are much more complicated compared to regular real estate transactions and usually require specialized knowledge.Tips to Successfully Navigate the MarketDo Your Research: Understand the local market conditions, including neighborhood trends, property values, and potential rental income.Build a Strong Network: Work with professionals who specialize in distressed properties-such as brokers, contractors, and legal experts-to make the best decisions.Assess Costs Carefully: Factor in the cost of repairs, holding costs, and any potential financing issues when evaluating a property’s profitability.Be Patient: Finding the right distressed property takes time.

Quote from @Jeff Sanders: Personally coming from an agent/investor in CA, I always get a quote from a broker of mine and make sure I am knowledgeable with the fees/costs.

It costs the same amount to replace a roof or furnace whether the house is worth $300k or $30k (assuming a similar size).

A post on recapture.People are concerned about recapture when they cost segregate their improvements and for good reason.Recapture is real, and those deferred taxes will need to be paid.But fear not!

.: @Leonard La Rocca IIIit will depend on the property, of course, but you are thinking about it the right way, so good job so far. you'll also have lease-up costs - the property manager will typically take the first month's rent, plus potentially a small fee to find and place a tenant.and yes - having to shell out that much cash IF you're just going to buy, spruce up, and hold is absolutely par for the course.there are other ways of buying - BRRRR, for example - but this is definitely one of them. in addition the prudent investor would have at least 20k liquid or avaliable when starting landlording for reserves..

Trying to get a # from him about estimated remaining cost but got nothing.   

The cleaning costs alone were over $9k.

This also leaves me with $3,750 stuck in the deal (not including financing and closing costs, which could easily add another $20,000).In total, if I had to include closing costs and financing costs, I’d have about $23,000 (if not more) tied up in the deal and lose close to $700/month before accounting for expenses.

At the end of the day; you need more money to do something like this.MAX LTV on new builds is 80% LTC, Meaning if the build is $550,000 and Land is XAdd ($550,000 + x ) * .8 = LOAN AMOUNTYou would need to come in with MINIMUM 20% of the cost in addition to closing costs and reserves, $80,000 is not going to cut it for this project.