Best Class for Rentals - A, B, C, or D

[Riley F.]

I was listening to Brie's podcast this morning and I started thinking about which class, over the long run, is the best for rental income (and headaches) : A, B, C, or D. I don't want to quibble about definitions, so in your response you can just explain what you mean by the class that you prefer to invest in., and what class you would consider that in your area.

I currently own B-/C+ properties, which are largely blue collar rural neighborhoods, the buildings are about 40 years old, are duplexes, suitable size, but certainly not where I would live given the choice. One of the things I am noticing is that repairs are generally required each month, at least for the first 3 months. Though I don't expect it to persist, I suspect that they will certainly exceed that of a Class A fresh rehab or new construction. It would seem to me that the caliber of renter is slightly lower than what I'd like or what Brie is seeing in Chicago, but the numbers, at least on paper are very good, approximately 30% CoC in KCMO, depending on variables. Also, I am certain there is an eviction somewhere on the horizon if I keep up with the class, not sure when.

I know that real estate is local, and that this is going to vary greatly from market to market, but I'd like to hear your opinions.

[James Wise]

B-C. 

D is a hassle

A is to expensive