It is in livable condition but needs cosmetic repairs.We are currently paying $1600 on a $220k mortgage and we want to sell and move to this home, but we would only net about $7-10k on the sale of our home. 

I will have 50K to start and I'm open to turn-key or a fixer upper (I have some experience with cosmetic renovations).

It was closed by the state about 1.5 months ago after the current owner didn't address all the cosmetic violations.

We did put in $20,000 in cosmetics, paint, floor coverings and minor repairs.

I ended up putting in $20k for light cosmetic repairs, which then allowed me to bring rents up to market.

Faced with these burdens, many owners choose to limit their renovations to cosmetic work or, worse, proceed without permits to avoid triggering the requirement.This raises a crucial question: which is safer—a fully gutted and renovated building with modern electrical and heating systems, rebuilt to 2025 code but without sprinklers, or a building where the original, outdated wiring and heating systems remain in place because owners chose to avoid triggering costly sprinkler requirements?

We've been doing a lot of work on the house but most of it has been minor cosmetic stuff.

For your first deal I would suggest a cosmetic rehab to mitigate your risk.

The cost of refinancing (few points on refi + title/escrow) is also lower than selling (5-6% agent fees, repaint/cosmetic to prepare for buyer, etc).If you don't like this current property, want to invest in a different strategy/market/type or property then it may make more sense to sell. 

The issue here is in order to increase rents at reasonable rates to cashflow well you need to not just do cosmetic changes they require you to do extensive plumbing and electrical to be able to increase the rents.