DIY Rehab--where to start?

[Dojo Kempin]

So I'm new here and stepping out on a (relatively) small scale.

I've been looking at the distressed properties around me, thinking of my retirement, and basically said, "hey, why not build some sweat equity on one of these wrecks." I bought a small REO for cash that will need fairly extensive work. (Closing soon.) I'm planning to work on it part time this summer, and for however long I need to get it ready. (Not sure yet whether to go resale or rental.)

The question, for those of you who have more experience, is simply this: Where do you start? I don't mean on my specific property, but for those who do extensive rehabs--particularly when you do much of the work for yourself--do you usually have a plan of attack? Are there certain things that experience has taught you to do first, or to avoid?

Bear in mind that this is my first investment property and I am excited. I need to find what is worth doing and what will not pay off. My initial thought is to get it rent-worthy and put a tenant in it--the rental market is very good here--but it is a small house a few miles from town with a large wooded lot. Maybe it would be better to renovate for resale.

Anyway, I love this forum and value the wisdom of the experienced. What have you done?

[Linda R.]

You said, The way I see it, the first step is evaluation. Evaluate foundation, septic, and structure thoroughly to find any hidden surprises.

No offense but you should've done this before you made your offer on the property so you would have a handle of your expected costs associated with the rehab.

As far as rent or sell, for me that depends on the final cost, if it cash flows as a rental, I may rent it, if it doesn't, then it is a flip.

Good luck to you!