The seller was having health problems, could not afford to make the necessary repairs to the house, and needed to sell quickly, as-is.

I couldn’t afford Boston so we bought 24 units (12, 7, 5) in northern NH, which generated incredible cashflow, all within 18 months.

Wait till spring to buy it or just make a few payments till summer.Don't buy something where you can't afford to make the payments for a few months with no renters.

Is this a good strategy to use that income to make third house affordable?

From all that I read on the forums Kansas City and the larger cities in Ohio provide affordable markets for OOS investors to buy a nice beginning portfolio that cash flows well.

However, the neighborhoods that I'm interested in are more expensive than what I can afford at the moment.I was thinking of buying a cheap uninhabitable foreclosure, doing a complete demolition, and building a brand new *modular* construction. 

I'm going to do a delayed mortgage and get the money out that I can't afford to have tied up in the place.2.) 

If you can't afford to sub out some of the work and have to do it all yourself, you are in a bind.

It affords you the opportunity to use your own deals as verifiable comps to raise the value of your next deal.

Some may see this as targeting people in a financially low position, but if I am helping them sell a property that they cannot afford the taxes on, and putting cash in their hand, I see that as a win win.