Are These Types of 4 Units a Good Deal?

[Drew McCrory]

Hello, I am a new investor looking in my surrounding areas for a 4 unit to buy and rent out. I'm hoping some of you more experienced investors can enlighten me on if I should check out other areas or if its possible for markets like this to cashflow.  Rental rates for the 4 units in my area average about $475 per unit. That's 22,800/yr of Op income. Avg price is about $130,000. And tax is about $4500/yr. I know theres many more expenses between vacancy,insurance,maintenance,cap ex, etc.. However, I would like your opinion on if these types of numbers with the lower rental rates can still cashflow. Any advice/opinions are greatly appreciated. Thank you!

[Bjorn Ahlblad]

@Drew McCrory I do not know your market; but 475/mo is definitely low rent. If you are experienced and recognize the challenges with lower income tenants, this can be a good business. Low income/low rent is far more labor intensive; do not think a PM will resolve all your problems either, a PM is a filter not an eraser, and they charge for every action (as they should). If you are newish to LL'ing you might look at higher quality buildings and easier to manage tenants paying higher rent. All the best!