Buying Turn-Key Investment Properties

[Anthony C.]

I have been noticing more and more turn-key multi-family homes for sale in my area (Rochester, NY). The sellers are using the newly remodeled interior to justify ridiculously high asking prices compared to comps in the neighborhoods. I have seen asking prices $30/sq ft. or more over the neighborhood average. Although some still cash flow on paper, I have heard that it is never a good idea to buy "the nicest house in the neighborhood," or in other words, pay the most per square foot for a neighborhood. The reasoning's behind this come down to not leaving room to grow. This has me asking two questions:

1) Is it ever a good idea to buy a property that is overpriced for the area?

2) Are turn-key multi-family homes ever a good idea for an investor?

Thanks in advance for any responses!