Cost approach A straightforward method that adds the cost of the land to the cost of building construction.

That being said, this depends on your overall financial situation.

While @Phillip Austin mentioned Raleigh is a higher returns its just very much a appreciation market, you will not find rentals that cashflow, so depending on your goals its a good or bad market.

Because we are dependant, for the most part, on word of mouth recommendations it is vital that our recommendations are valid. 

Once it's rented, use that rental income to help offset your DTI, which may help you qualify for the second property sooner.Partner with Investors: Team up with someone to split costs and lower your personal DTI impact.

It also depends how distressed - knockdown, full gut rehab, cosmetic rehab, lipstick flip.

What's the location, purchase price, expected Reno cost, ARV, etc.?  

With your budget, depending on where you are working, I'd consider Silver Spring or Hyattsville  

new construction gets valued at a way higher premium. this is a false statement. new construction will always beat existing Very market dependent.

However, this has to be the primary residence of everyone on title in order to qualify and even if that were all true, we're still only up to $1M that way.I agree with the other commenters, the parents should continue to own it and live in it as their primary, leave it to the daughter when they pass, and she inherits it at the stepped up cost basis.