The high HOA fee is already a factor, so ensure you’re comfortable with the overall carrying costs.Focus on the Land Value: Since the lot has development potential, you’re looking at this as a long-term investment.

The real risks are to the seller..

Competition with owner-occupants and the age of the homes (70-120+) will squeeze your margins and expose you to a fair amount of risk.

They use leverage in some of their funds, which can increase returns, especially if they have a low cost of capital (but potentially increase risk and trigger UBIT issues).

I have so much to learn starting out I don't want to add any unnecessary risk or headaches dealing with out of state properties or long distance rentals. 

I’m trying to familiarize myself with the area more thoroughly.it seems to have a stable increase in prices.Since I plan to live in the property initially, breaking even in the first year is my main goal. (5% down; PMI removed with renovation)However, I’m also wondering if it’s feasible to have some cash flow from such rentals, or if the risk of vacancy is high in this market.Any guidance or pointers from those experienced in this area would be greatly appreciated!

I am leaning toward removal because the floor is run down, the risk of increased pests or feral cats, and there is already a storage closet off the patio.

Transitioning from Individual Deals to a Scalable ModelScaling up your distressed property portfolio means more than just increasing the number of deals; it’s about creating effective, repeatable systems that minimize risks while maximizing returns.

I used the concept to do arbitrage on 3 more of his properties and then transitioned to more of a management model in 2020 to offset my risk.

Do you mind sharing the name of that type of loan/lender that allows you to have the seller carry on a second position?