Sometimes the home is not able to be lent on in the current condition so you'd need to get a rehab loan like a 203k which in their own right can be complicated.

It doesn't look like they have equity (based on the condition of the second home).

At that price point you will find condition of the property is key and quality of tenant is critical.

In your scenario - is it the condition of the subject that is preventing financing, or is it the renter/owner ratio?  

When rates are increasing over a cycle, it's usually because employment and lending conditions are improving, optimism improving, more cash on hand, oftentimes more than offsetting higher rates.What I think we can say with a high level of certainty, is that in any given economic backdrop, lower rates would very likely cause higher prices, and higher rates would very likely cause otherwise lower prices.

Depending on the the square footage and condition of the house you can usually get $350-$500 a room.  

David StoneElma, WATHE NUMBERS: Our purchase price in 2009:  $155,000Currently owe:  $136,000Mortgage:  $1080 / mo (PITI)Rent:  $1000 ($100 above median, but house is newer condition than neighborhood), Tenant pays all utilitiesProperty:  3 bed, 2.5 bath, 1576 sq ft, built 2008, located just outside Shelton, WAFair market value:  $166,000 according to Zillow private estimate of comps I am looking to make a minimum of $35,000 from the sale of the property to make it worth itBACKGROUND:This certain property was not originally purchased for a rental.  

The area is more C+, bjut I'd never recommend buying a property with tenants in place unless there is (a) a strong and documented record of timely rental payment; (b) you have the opportunity to speak to the tenant about the condition of their unit and the property in general prior to the purchase; (c) you run a thorough background screening on the tenant to make sure they will pass your standards for a resident.Agents often seek to sell properties when they should strive to build relationships by offering good investments.

If it were me, I would want to be on title of the property and have a separate JV agreement that outlines all the terms and conditions of the partnership.

If you can get it to a condition where you're comfortable, and the next buyer will get what they expect, in a rising market you will hopefully come out okay.