Pros and Cons of Already Occupied Rental

[Harold Henderson]

I've come across a property that meets major criteria, ie location and price. One potential bonus is that it's already occupied with tenants. I must admit that that information set the warm fuzzies ablaze as finding tenants would be one less thing to worry about for my first investment property. On the one hand, it seems like the stars are aligning in my favor. On the more level headed, practical side I don't want to let my emotions take over and impulsively jump into a potentially bad situation. I've heard it's best to screen tenants yourself or at least have final word over who occupies your property. I've already requested more info on this property and I'm dying to find out why the owner is selling in the first place. Oh, and I actually lived near this location so I'm familiar with the schools and neighborhood. It even comes with a built in exit strategy... worse case scenario, I evict the tenants and live there myself. By my calculations the base monthly expenses ( including taxes and insurance, minus cashflow from renting it out) would be the same as I pay in rent right now. Almost exactly the same!

But, back on point, is it advisable to pursue an already occupied property and why or why not? I can already hear the "NOOOOOO's"... or maybe that's just my imaginary friend Cpt. Winky the snuggle monster talkin' to me again.