We bought our first rental property, a duplex in Portsmouth, VA, in what we assessed was a C neighborhood in March 2023. It is also a long distance rental property. There currently appears to be a flow of investors still buying and renovating properties in this area, which seems encouraging. We bought it for 189k and the units were renting for $850 and $950. Both units were filled at the time of purchase, but both had to be evicted a few months later due to failure to pay rent. We had planned on eventually redoing the kitchens and floors in both units once we turned over new tenants, but the evictions accelerated that process. We did major renovations and repairs on both units for about 40k total and were able to get rents up to $1250. The property could likely sell for close to what we put in, about $230k, based on other properties in the area in similar condition. We then had about 6 months in one unit until that tenant had to be evicted. The other unit went about 4 months until they had to be evicted. We were able to fill one unit again, but the other has been vacant since mid September (over 3 months). We have had full occupancy for only 3 out of 20 months of ownership. Some of those vacant months though were due to the renovations. Our property manager has said Portsmouth is a difficult area and we are going through a slow time now. Our manager's credit score requirement is 550, but even that has been hard to satisfy. Our manager has tried outsourcing filling the unit to a realtor agent with agent incentives but that has not produced any results in the last month. I asked our manager about reducing the rent but he said we are asking a fair amount and we are getting lots of interest but a lot of cancellations, no shows, or people who don't follow through with applying or don't meet minimum credit score. We were offering $300 off first month and just recently increased the incentive to 50% off first month. I suggested waiving the entire first month but our manager suggested we wait to see what happens with 50% off first. I do believe we have a good property manager and the photos and description of the listing are well done, so not sure what else to do at this point. I am reluctant to sell because all we need to do is fill the 2nd unit and we will be cash flowing about $800 a month. We told our manager we are open to Section 8, but have not had any interest there yet either. The activity of investors still buying and renovating properties in this area seems encouraging, but I am not sure how much luck others are having finding tenants. This is an area heavy in house hacker investors so they still have to find at least one tenant for a duplex. Lesson learned is to pay more to get into a nicer area (B neighborhood) with more reliable tenants to avoid the vacancy risks, but again, if we can just get the 2nd unit filled we will finally have stable cash flow. Any advice as to how to get the unit rented is much appreciated.

Norfolk, Virginia

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