House was in bad shape with outdated carpeting, wallpaper etc....

Think crayons and dirt smudges on walls, spills on carpets, etc.  

So we have to replace the carpet and floor wood and cabinat board under the sink for that area, and repaint the ceiling.

In many cases, the floor between the two is a conventional wood floor- i.e. wood joists, subfloor, and floor with carpet or tile as a walking surface.

They are cheap enough on amazon.How old is the carpet and how big of an area is it?  

If we put a tenant in the house we will have to pay the state back their $8,000 of assistance.Loan Balance: $150KCapital Required to Rent: $10K ($8K to pay out the state and $2K that I put into professional cleaning and new carpets.) 

Should I just carpet (1000 sqft)?

After the eviction process, we got back possession and discovered significant amount of damages from feces on carpets and walls, broken garage door, broken fence door, broken laundry washer, to unimaginable horrors on the trees, and landscapes.

I am planning on installing new carpet, countertops and paiting the cabinets right away when purchasing.

I would give them the red carpet treatment.