My Triplex is Gross - Am I A Slumlord?

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Hi Everyone! I am new to the forums, but I love the Podcast. Thank you in advance for listening.. here goes...

My husband/partner and I found a great triplex property in (Deep East) Oakland, CA. This area was pretty rough a few years back, but it's getting better and better.

About the property:

• Triplex cash flowing at about $350 per door at current rents
• This is an ugly house. Aside from lots of junk and trash in the house, everything needs to be updated. I am not afraid of an ugly house. In fact, I love a good ugly house to gut and make beautiful again.
• It is currently fully occupied. Current rents are very high. Based on size and location, it is renting at about $500 more than normal because tenants are Section 8. They have been there for years and looks like they like where they live. If these were not Section 8 tenants, based on the condition of the unit, rents would be much much lower. More on that below…

Here’s my plan:

As mentioned earlier, the triplex is gross (carpets are gross, kitchens are old, bathrooms are mildewy, etc). The units are dilapidated. When I close on the property scheduled in a couple of weeks, I plan to dump money only on necessary safety issues like fixing the water heater, fixing some roof issues, fixing a broken window, etc. - normal stuff and nothing crazy. I also plan on cleaning vegetation on the outside of the property. Lastly, I will have my property manager enforce rules for cleaning the outside.

Here’s my dilemma/my emotion:

Ideally, if the units were empty (my normal preference), I would completely fix the units and update the baths and kitchens and actually aim for the rent that it is currently going for. But, since the rents are already high and the units occupied - I feel like my job is sort of complete and the investment seems more like a turn-key property.

I like the rents on this place and I know I can save the profits towards renovating it later. I am not in the business of kicking people out and to be honest I don’t have a lot of money to do a complete rehab of the property right now so I look forward to saving. I plan to renovate the interior when a tenant moves out and I can get the entire place empty then bring it up to higher standards because 1) I know I can’t rent it out for much at this current condition and 2) I want to actually provide a nice home for someone.

When I walked into the units, I felt disgusted. I don’t like the idea that I will own something that I don’t feel comfortable to walk into. On the other hand, if the tenants are okay living in this type of place and don’t complain, do I need to make changes?

Questions for you:

• Do you think I should feel bad about the situation?
• Have you ever been in this type of situation and felt the same way as I did? How did you maneuver through it and what did you end up doing?
• I know Section 8 has a bad rap, but have you ever had a positive experience?
• Do you own any places that you didn’t like/wouldn’t live in?
• How do you or your property manager handle dirty tenants?

Thank you for your time. I appreciate it.