Updated about 4 years ago on . Most recent reply
SUPER serious question: regarding "location, location, location".
Can anyone give me a simple 1-2-3 list of pro's and con's to investing the "bad area" of town. I have often said i will NEVER LIVE in West or North Birmingham, Alabama due to the crime and neglect. Why SHOULD I or should I NOT invest in these same areas? There's ALWAYS something available....TIA!
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@Champ Leong
You seem to answer your own questions in your post. If you don't want to live there because of crime, blight, neglect, etc., neither will others.
The pro to investing in rough neighborhoods, especially if you're new or don't know the area and tenant class well, is that you will quickly become a spreadsheet millionaire and Excel will fool you into thinking you'll get exorbitant returns.
The reality is the property will have deferred maintenance, property managers won't manage their, and the tenants that you place will be a representation of the neighborhood. All neighborhoods that are lower on the socioeconomic scale aren't automatically filled with bad people. There will be good, hard working tenants, but even these people may struggle to pay bills and upkeep the property.