More often than  it, these properties see a lot of wear and tear from frequent turn overs and some things that aren’t “big deals” to existing home owners or PM’s go unnoticed or untouched until a new buyer comes in. 

We are looking at the possibility of tearing down the house and building a multi-unit. 

My advice:  It's hard to "cut your losses" and tear off the band aide, it will feel a lot better quickly and soon be a distant memory. 

If Tenant A sneaks in a dog that tears up the carpet, Tenants B and C are responsible for the cost of repairs.

On top of that the fine print in the policy stated that wear/tear items such as seals and gaskets weren't covered. 

Homes at 150k are tear downs, or would require I would imagine, at least 30k in rehab.There are no homes that simply require a lick of paint for under 200k.

I'm thinking of keeping the smaller home and keeping it rented and then tearing down he unfinished house while eventually putting a shop up. 

Hi Raheem,Be ready to see some "Wear and Tear" that might not have been there when they moved in."

Without seeing your specific policy, we can't know whether or not this situation is covered, but I can say that normal aging/wear and tear is excluded from many policies.

I shed a mental tear for you.