Rentals in competitive areas or non-competitive areas?

[Ryan Velasquez]

I always wonder if it is better to have rentals in areas that seem to be very competitive with several competing units in the immediate area, or better to have rentals where there are very few competing units in the immediate area.  However, it seems more often than not the areas in higher rental demand and higher rents have typically more competition and more units available, and the areas of lower demand and somewhat lower rents have fewer competing units.  So the question is where am I better off buying assuming the higher rent demand rental areas also command higher purchase prices.   I am always asking myself this question and would love to hear other thoughts on this topic.