I would love to offer a few tips for purchasing a rental or flip.
It is important to pay attention to the homes within eyesight of the prospective property. Buyers don't want to be next to the worst house in the neighborhood and will choose not to buy a home if the house next door is run down or unattractive.
For a flip you want to be thinking about passing FHA mortgage appraisal guidelines: no peeling paint, flooring on all floors, no holes in the walls, railings on the stairs and the well must be outside of the home's foundation.
Items that help a home to sell: large bedrooms, master bath, formal dining room, finished basement, storage closets, new windows, fenced yard, garages.
A perfect flip will have all of the above items but simply needs updated. Paint,flooring, lighting, kitchen counter and bathroom vanities are the typical updates. The age of the furnace is also important, try to have a least a 90% efficiency or keep the price down.
Modern lighting can make a major difference in the appeal of the home.
Sometimes you will find a home with all of the above items outdated but in good condition. If it will cost next to nothing to have the home livable, you may want to consider doing the minimum cleanup and renting. In many cases you can knock money off the first few months rent and the tenant will do any painting and cleaning themselves.
When a home is marked way below the average for a quarter mile radius and has over 1000 square feet with a basement and a garage it is probably a good flip potential. Reconfiguring the infrastructure works best for adding "perfect flip" items to the home. Plan to also replace the copper, furnace, siding and windows as part of the budget. Always have the well and septic inspected whether purchasing or selling the home. It can cost over $20K to attach to a city sewer due to a failed septic inspection.
There are items that allow you to have a higher rental rate than average in the area: fenced yard, a good school district, garages and extra storage. The right school district can make your investment into a gold mine. Rent-to-own with a 10% down payment to be subtracted from the price at the time of sale is another way to attract top dollar tenants; all leases must be drawn by an attourney.
Always remember the most important rule to flipping or renting a home: Location location location!
