I bought 30k pigs in Ohio with success.

[Jered Sturm]

30k houses in OH have been a topic on bp. Because they gave me my start I had to give my 2 cents. I bought the low cost pigs in Ohio (Cincinnati) to hold and it worked for me. Because of this I get asked all the time from guys/gals "you got started buying houses for 10-30k I think I can afford that. is this how I should start?" And to all those people I say probably not. To begin let me explain where I buy: The median house price is 90k, there is a 60/40 OO to rental split, 25% of the residence have bachelors degrees. Call that c class b class I don't care in these areas There are some investors that will buy a pig and put lip stick on it. Others may do one better and buy the pig a nice new dress. From day one I knew the pigs I bought I would gut, and turn it into a nice Christmas ham. I bought the 15k house that needed 30k in rehab. Or the 7k house that needed 60k in rehab. Why? Because my labor/skill was all I had to offer at the time. My self and my partner wanted to get into REI, we had little money, little experience, no understanding of private money, lots of time, and lots of skills in the construction trades. We would do all 30k in renovations our self and it would only cost us 10k ( not paying ourselves). And it worked, BUT it sucked! It's hard it takes to long and this is not passive at all. The main concern with the 30k houses is cap ex. We minimized this by adding much of our own labor. We would update everything in the properties to avoid as much cap ex down the road while also tenant proofing. This has left us with fantastic rental properties. However it was a very difficult 3 years to get there. I will be leaving this strategy behind. I would advise others to take an alternate route as well.

[Dawn Anastasi]

Instead of buying a $15k house that needed $30k of rehab, you might have considered a $25k house that only needed $5k in rehab.  Your turnaround time would have been much shorter and you wouldn't have had to spend so much of your own time doing it.