Buying a 4-plex for under $30k.. but in a class D area. Worth it?

[Benny Morfas]

Hi everybody!

I thought I’d turn to the forums because I saw an interesting deal, but there’s some red flags.

Since I’m relatively new to real estate, I’m hoping some more experienced people can guide me in the right direction.

I found a deal for a 4-plex out of state listed at $39,900. It’s been on the market since January 2019 so I feel like it could easily be bought it for around $25-$30,000 or even less. The property details list that each unit rents for $475/mo. It sounded too good to be true.

Here come the red flags. It’s in a class D neighborhood and supposedly one of the most dangerous areas in the state and the property is in “distressed condition.” I know that it’s highly advised against investing in class D neighborhoods.

If somebody could give me some advice on what to do I’d highly appreciate that! Thanks so much!!

[Aidan Mulligan]

Here's what I get concerned about with this types of property. If you fix it up and sell it, who is going to buy it and for how much. If you fix it up and rent it, how much are you going to spend every year repairing stuff that your D class tenants broke.