We were in a similar situation a while back, but the owner of a house we were interested in had recently purchased it from a tax auction as a flip. We were willing to offer him a little profit if he sold to us so that we could rehab and live in it, netting everyone a positive outcome. Seller agreed, we walked the property and it needed a lot of work. Though I'm a property manager and know 99% of what to look for, we had the contract written up to include an out clause for a professional inspection, so we could still pass if something we didn't notice popped up. Upon the inspection, we learned that the septic tank was 30-40 years old and leaking into a nearby creek. The lot size is too small to fix or put a compliant system on, and even if you could, it was within the city limits so you'd never get a permit. The only solution was to hook the house up to the city sewer system. Had an engineer submit a bid and costs were over $30,000. This basically killed the deal and would have had us spending more money than a comparable move in ready house nearby, so we passed. So, long story short, unless you know absolutely everything about your local code and things to look for, have your realtor write the contract so you can get out after an inspection and hire a really good inspector. We were out $500 for the inspection but it saved us thousands in buying a house that is now likely to just be demolished.