Central Illinois BRRR

[Scott Anderson]

I purchased my first SF rental in the spring of 2019. It was a foreclosure in a town of around 15,000 people. The home was a 3 bed 2 bath with a hole in the roof, missing flooring, and general neglect. They were asking for $28,000 and I was able to negotiate the price down to $24,000. Using a local bank to obtain a construction loan I was able to get a loan for $34,000 at 5.5% to finance the purchase and have $10k afterward to preform the rehab. The total cost to fix up the house was around $13k, which means I spent around $3k out of pocket when the home was finished. 

I was able to get $675 a month in rent for the property on a 12-month lease.

Mortgage- $246 per month

Insurance- $60 per month

Taxes $1600 per year ($133 per month)

I am not sure if investing in downstate IL is the ideal investment because property taxes are high, the state is losing population, and there is very little appreciation. I decided to invest here because its where I grew up and I know the local real estate market and I was able to get my first deal with low money down. I currently have 2 rentals in my hometown. 

I want to get advice for my next step. Should I continue to invest in my hometown given that the numbers work for cash flow, I have established connections, and I know the market? Or do you recommend that I look to invest out of state in areas with population growth and better appreciation?

Please let me know what you would do in my situation?