We're looking at a house way below our budget with the layout we want in a location closer to the location we wanted than we'd ever thought we get. It's within walking distance to all 3 good schools my kid would go to, a nice grocery store, a movie theater, a coffee shop, a couple of restaurants/shops, and about a half mile to a lake with a bandshell/walking paths. We could easily sell our second car and never miss it.
The problem is it's been neglected and needs quite a bit of work: replacing sad looking fiberboard on the outside of the house/garage, tearing down a non-permitted 3 season porch, putting in an egress, replacing water damaged ceiling tile/paneling (and who knows what we'll find behind that), gutting a bathroom that's got a funky smell and some really rundown fixtures, fixing up wood floors, and a buttload of landscaping.
We'd be able to get the house around $270,000 and we're estimating $50,000 for repairs from back of the envelope math. It's neighbors are going for $400-500,000 if their older, or $700,000 on up for teardown/rebuilds.
The question is, how much is too much for newbs? We've never tackled a project of this scale and I'm worried since so many of the issues can be attributed to water damage, that the issues are just going to cascade when we start opening up walls and it's going to turn into the money pit a la Tom Hanks style.