Advice for possible REO triplex deal

[Conrad Erb]

Hi Biggerpockets.

I'm wondering if you could give a "newbie" some advice on a property in Philadelphia.

I currently own an investment triplex (C+ neighborhood) and just purchased my own home (A- or B+ neighborhood).

I have an opportunity to buy a bank-owned/REO residential triplex (3-unit building) in a "D+" or type of neighborhood for $62k. I would be paying cash, and then looking to refinance later.

Comps are hard to determine, because the area is very block-to-block, but I think that if the property were fixed up, it would sell for closer to $90-100k.

I'm an athletic guy, and I feel comfortable walking around at night but wouldn't want my friends to live there.

Layout is one 2 bedroom apt, and two studios. Cosmetics inside are quite good.

Repairs of roughly $5k (stolen copper). I think that it could conservatively around $1400 in rent.

The property has some nice upgrades: new windows, old hardwood floors in good condition, and newer furnaces. Utilities (gas and power) are all separated, other than cold water.

By the 2% rule, this looks like a reasonable investment.

The neighborhood is slowly getting better, and the triplex is around the corner from the neighborhood commercial street with lots of pizza shops, salons, check cashing places and the typical things that you see in a lower income area. The property is a block from a high school and directly across from a large church that is very active and well maintained. Security and vandalism will be something that will be on my mind more than other neighborhoods, of course.

ARV on nearby SFHs is in the 40k-75k range depending on condition (lots of poor condition homes because people don't have the funds to maintain them),.

After accounting for taxes, maintenance, insurance, utilities, I think that the place would cash flow about $1000 a month - or $300 per door.

For someone who is still a "newbie" investor, what are the red flags I should consider? Am I missing something here? $62k from a bank just seems like a good deal and could be a good buy-and-hold investment.

I just don't want to get my butt kicked here in a rougher neighborhood.

Would love to get input from seasoned investors.