Townhomes in Grayson Valley

[Omer Zakai]

Team, I wanted to ask for your advice. I have 2 properties- under contract in Birmingham, AL ( both in the same area- zip 35235). The first is a 2BR/2.5Bath. The property is turnkey-key ( buying from a homeowner) and has some nice features like a patio and fireplace, and it's 300 sqft larger than the other 2BR in the area (1400 sqft- where other 2BRs are at 1000-1050). However, 2BRs in the area rents for $900, making this deal not attractive ( it has to be at least $1000). If I use only "formal rental reports I got from my PM to set the rent, it could rent for $900-$950, but I feel I can get more for it based on its condition and size. The second one comes with a tenant who pays below-market rent ($750, and the rent should be $850-$900). I have a similar property in the area that I rent for $900). I think I will move forward with the 2nd ( got him at a good price) as I can always raise the rent at the end of the lease and, worst case, find a new tenant, but I am debating about the first one... Any advice you can share to help me to make a decision?