The Good Neighbor Next Door (GNND) is an excellent program and the answers and links have been mostly accurate. Colorado has had a decent supply of GNND homes available through HUD and I typically lend on 2 - 4 properties a month. Most of the homes require rehabilitation and therefore, the FHA 203k is the usual product. I like to say that 75% of the homes require 203k and at least half of the rest choose to do a 203k to update the house.
In addition to the great discount of 50% of the purchase price (no overbidding) is that the buyer/borrower is able to finance the closing costs and realtor commissions into the loan. The minimum investment is $100, but you will need to have 1% of the purchase pricea available for the earnest money when you win a contract.
A couple of my realtor partners specialize in the GNND program and HUD homes and I'd be happy to refer you if you need help. Feel free to contact me with any questions about this program, the FHA 203k Renovation loan, or HUD property financing.
Universal Lending Corporation