If you're thinking being gutted is a negative, here's a different point of view. Our investors love to pick them up when they're gutted, it's a lot less work for them to do and they're usually priced way below comps, leaving plenty of room for a profit. Choose a Realtor who knows the neighborhood well, have them pull up comps of homes in good condition. Hire a contractor to do an estimate for you, tell him what you would want done to the house. Take the average Sold price of homes in good condition, subtract the amount it will cost to have the work done and make sure you have about 20% in equity once the house is finished. Here's an example of what one of our investors did with a gutted home. The average Solds in the neighborhood are $1,000,000 to $1,200,000 for the size of home that he was going to make this home. He bought the house for $450,000 (completely gutted). He popped the top and made it gorgeous for $350,000. He's into the house for $800,000 and can easily sell it for $1,000,000 if he wouldn't have decided he loved it and decided to move in instead of selling it. Our Investors in lower priced homes are doing about the same calculations only they do all of the work themselves. Have fun with your project, if you decide to do it.