Dave Hatfield (on right) with partner Don Clem

NEW YORK (CNN/Money) - A few years ago, if David Hatfield had taken a life inventory, he would have found a lot to be grateful for.

He had a good job as a computer network engineer at Wright-Patterson Air Force Base near his hometown of Dayton; a wonderful wife and two kids; hobbies that he enjoyed like golf, tennis, and fishing. Still, he yearned for something different.

Through a combination of friendship and serendipity, he got it.

"My new hobby is real estate," he says. "That's what I like to do."

In 2000, his old pal, Don Clem, bought an abandoned property with Clem's father-in-law, Bob Dillhoff. The house was a mess: the roof leaked, there was water damage, it needed new plumbing and electric. But they paid only $42,000 for the two-bedroom, one-bath.

Before they could renovate, however, Dillhoff was injured and gave up the project. Instead, he made a generous offer to finance it, and Clem considered asking Hatfield in.

"I thought of Dave right away," says Clem. "I've known him since grade school, and I knew he was energetic and interested."

"We did all the work ourselves," Hatfield says. "We'd meet after work and stay on the job until midnight. We got it all done in about a month." The renovation cost $12,000 in materials – and lots of sweat.

They found a tenant and rented it out for $560 a month. Their sweat equity covered at least 20 percent of the value of the house, so they didn't need to pay mortgage insurance.

That first project hooked Hatfield.

"I loved it," he says. "I loved doing the renovation. I love learning new things. My partner is a genius about this work – he was a construction company supervisor for 15 years, and is very good at teaching these skills."

Bargains abound in this part of the country. Clem and Hatfield bought a fixer-upper, a HUD foreclosure, that cost $47,000. Next came a two-bedroom bank foreclosure for $38,000, and then, in the desirable suburb of Beavercreek, a three-bedroom for $70,000. They usually budget between $12,000 and $15,000 on materials to renovate these places.

On sale for $82,000

They also bought another two-bedroom in Dayton that proved less profitable. They paid just $40,000 for it, but they experimented by hiring contractors to do the renovation. "That cost way too much," says Hatfield.

In addition to the houses owned with his partner, Hatfield and his wife own their own home, a six-bedroom, three bath, brick bi-level in Beavercreek that he paid $150,000 for three years ago and is now worth at least $180,000.

Last year, the partners expanded out of Dayton to a community 65 miles away, near the town of Hillsboro, Ohio. The families knew their area from camping there regularly at Rocky Fork Lake.

"The women didn't care much for the camping," says Don Clem. So when he and Hatfield noticed a single-wide, mobile home with a carport for sale on a quarter acre, they snapped it up.

There was an empty lot on the lake right across from it. "I thought if I built a dock, the owner would agree to let me use it," Hatfield says.

Instead, the owner sold him the property for just $5,000. He had been having trouble selling because the lot was hilly. "But my partner knows how to build on a hilly site," says Hatfield.

That got Hatfield investigating more lake properties.

"Hillsboro is one of the poorest areas in the state, but that seems to be changing," he says. "A new Wal-Mart and a Kroger went up nearby, and DHL and Airborne Express moved operations to nearby Wilmington Air Park. Something's happening."

The partners bought three more single-wides in a package deal for $44,000. They continued to rent one out for $350, and remodeled the other two, then put them on the market for $38,900 and $31,900. After expenses, they'll net a small profit when those places sell, and they'll still own the third home.

Recently, Hatfield found a property a quarter mile from his own house in Beavercreek, for which the owner wanted $19,000. He managed to pay just $13,000, and will spend $2,000 to clear the property. He has listed it for sale at $27,900.

Hatfield and Clem have expanded into contracting. They've hired two workers and plan to take on two more soon. Clem says he expects contracting will soon account for half the revenue of Cleet Homes, the name they chose for their business.

Things have gone so well that he quit his job. Hatfield hopes to do the same, perhaps as early as January.