bought a 1300 square foot all brick house for 5K.

The square feet of the property could make your dwelling coverage much higher than you thought it would be.

One way to start out could be getting someone to owner finance a deal into your LLC, this way you skirt around all of the red tape a conventional lender would have. 

@Patrick Britton, are you saying the cost of repair is $45 per square foot and $75 per square foot based on age? 

On the flip side, if you are spending $500-$1000 to buy square footage, I would guess you can just about build anywhere for less than that, so if you have available room on available property that might be a no-brainer. 

Replacement Cost is obviously better but...On a Replacement Cost Policy you’ll be required to carry the Dwelling Coverage amount something close to the full estimated cost to rebuild the home.Diff states have vastly different rebuild cost.In my state it averages around $150 per square foot to rebuild x 1000sqft = $150,000 A replacement Cost Policy would require you to carry $150,000 dwelling coverage.

@Jerryll Noorden buying a house and car are what put him in the red.

@Lawrence Snipe, that's sort of like asking if red is a good color. 

No website is a red flag. 

I would give them a rent rebate for the loss of use of that room based on time and square footage (i.e. if the sq ft is 20% of the home, and it's down for 1/4 of the month, it would be 5% of their monthly rent paid back to them (not a discount, but returned after they pay on time as expected). if it's $1000/month rent in this example, that's $50.