Hi Paula,I am your neighborhood :) Started out just like you.

My neighborhood is zoned R3 (multifamily) but the three properties are single family homes.My house is much (MUCH) nicer than the other two properties and even though my family and I are a little cramped where we live I had never thought of selling until I got the call from the realtor.

It's a mid-sized town and in a residential neighborhood, so I don't think I could put a mobile home there.

It is great you are being conservative but it tells me you don't have really solid grasp on the neighborhood values.

While all the areas of the country are different, in my area, it takes a minimum of $100K to buy anything site built the size of a 16x80 in a decent neighborhood.

Look for rentals staying in the immediate neighborhood.

I think Brandon Turner called this 'hybrid investing' in an article.Ive bought houses for less than half what they sold for 10 years ago in great neighborhoods.

Barring that, you should be able to get the local authorities to compell the uncooperative homeowner to work with you, as it is definitely a health concern for the neighborhood.

We have a practically paid off rental property (we owe 39K on a 5.25% 15 yr fix) in a great neighborhood that has had the same renter in it for 7 1/2 yrs.

I myself just came across a few for $500 to $3000 in decent neighborhoods in southern California believe it or not.