Markets for A or B class neighborhoods

[Payal Z.]

I was wondering if anyone knows about any areas which has a better cash on cash return than 5 to 7 percent for properties in the A or B plus neighborhoods that are relatively newer 1990 or later built. I describe A or B plus neighborhoods as places where professionals would feel comfortable living with good school districts or close to vibrant parts of the town. Thanks!

[Jonathan Mednick]

5-9% returns in Birmingham are for A class properties. With B properties, you can expect 9.5%-11% return. With C class 11%-13%. That is the averages but many of our investors have been receiving returns as high as 15-18% mostly with their C class  investments. With higher returns comes greater risks.