Small Town Investing: How Small is Too Small?

[Zach Mueller]

I am new to real estate investing and am looking for my first deal. While I am mostly looking for a deal in the larger markets near me (Twin Cities or Des Moines), I came across a four-plex in a small town. The numbers seem to check out (+$800 monthly cash flow, +30% cash on cash return, etc.), and the building is currently full with long term leases in place (not sure how much time remains on each lease). However, the town it is located in has a population of about 1,300 with no thriving metropolitan area within 100 miles, which gives me concerns about finding future tenants and higher than average vacancy rates. Has anyone had a similar experience and can share some wisdom?  

Thanks! Zach