Compromising to Keep Going

[Billy Quirke]

Hey Everyone,

I currently have a single family home where I am renting one of the bedrooms (my primary home) and a duplex in a neighboring City (Joliet, Il). I've owned the single family home for 4 years and the duplex for 3. Since I bought the duplex, I've become a bit stagnant in terms of buying another property with pricing going up in my area as well as the costs of maintaining the two properties (the duplex specifically). The repairs on the duplex were all planned for and all the cash flow I get from that property has stayed in reserves from the beginning until I feel comfortable taking money out. I had 2 major repairs last year at the duplex that set me back a bit. This property cash flows $200 per unit including budgeting for repairs. 

 I have 2 properties (duplexes) in the surrounding area that I have been running the numbers on and I believe they will cash flow about $350/monthly per unit based on the comps I have. These are both outdated properties that would require work on the front end. I think a lot of value could be added to these properties with pretty simple improvements that I can do myself, but I know with older properties more substantial repairs will occur.

Basically my question is - based on other investors experience - is it worth it to take on more of a risky property (older and in a worse area) that will cash flow in order to keep the ball rolling in my investing?

Any advice is greatly appreciated. Thanks in advance!