The house will need new interior everything - plumbing, electrical, kitchen, bathroom, walls, etc. 

Foreclosures, short sales, and off-market deals can provide these opportunities.Target up-and-coming neighborhoods with increasing home values rather than already hot areas.Research comparable recent sales and get an inspection to accurately estimate the after-repair value (ARV) before making an offer.Follow the 70% rule - the purchase price plus renovations should not exceed 70% of the ARV to leave room for profits after selling costs.Focus renovations on maximizing returns - kitchens, bathrooms, curb appeal rather than over-improving.Hire experienced contractors and have a project manager oversee work to keep things on schedule.Price the renovated home at or just slightly below comparable recent sales to facilitate a quick sale.

Research local rental market trends for 3-bedroom, 2-bathroom homes to determine competitive rental rates and ensure they align with your financial goals.Consulting with local real estate professionals can provide valuable insights into market trends and potential challenges.

As a First Time Home Buyer you can get all the Financial Discounts and Low Down Payment.

Essentially, we want an extra room with a bathroom and a small kitchen primarily for our own use and for extended family to use.

They are basically renting an apartment with a kitchen and bathroom, but I am telling them they are not allowed to live there.

If you plan to originate and sell, to get yields into fair market territory, you'll be discounting your paper, meaning that your margin on the home will need to be high enough to absorb the discount and still produce a better return than just outsourcing the lending process.

The place needs a little bit of renovation (kitchen, floor in all rooms, bathrooms).

I can buy tile, light fixtures, bathroom fixtures, drywall, paint, primer.

My only comment would be that C class properties are not worth the discount you’d get at acquisition.