As long as you have the skills the first thing is to find the right home. We picked up a home for $175K that would have been $250K if it were updated. The house was built in 1950 but that was the extent of it, original kitchen, bathroom etc. I will say everything was in really good shape, walls were good, molding was nice and the hardwood floors while never fully finished were in excellent shape because they were apparently covered by carpet the entire time. You can still see the planer marks on them.
For $30K and a lot of work it's now worth $250K.
The only work we had done by pro's were the windows and the granite countertops, if I had time I would of done the windows myself too. I should note I'm bit more knowledgable than your average homeowner and have a lot of big tools like dedicated molding machine which can really cut down on costs when you can work with rough cut wood.
If you're going to do this be sure to look at what the house can be and not what it is. For example the house we purchased really had no dining room but there was a bedroom adjacent to the kitchen. We took the wall out and took out a window to put in a door which is going to nicely head out onto the new deck we haven't put in yet. Now we have a nice transition from the kitchen to the dining room out onto a deck.
Sit back and decide what you're going to do and tackle one room at a time with a clear plan in mind before you start going at it. I laid everything out in Google Sketchup first, there was a lot of changes from what I envisioned in my head once I had it laid out in Sketchup.
One thing I will ask is are you prepared to live in house that is being renovated for the next year or two?