Should you buy turnkey or fixer uppers? Pros and Cons anyone?

[Jamie Montpellier]

Hi everyone,

A business partner and I are on the brink of making our first joint venture deal but are faced with two different scenarios. 

Scenario 1 - Buy a 4plex (New build - less than a year old)

Asking Price : 600,000$  / 4 x 2 bed,1bath renting @ 1200$ a unit.

Location : Grade A   new suburb / residential

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Scenario 2 - Buy a 6 plex (More than 40  years old, needs new roof, gutted unit (renovations needed) and cosmetic work).

Asking Price : 525,000$ / 4 x 2 bed, 1 bath renting @ 900$ unit.

Location : Grade B minus / : older part of town with mix of commercial

I understand the concept of capturing equity in the scenario 2 but doesn't that get offset with the higher capital appreciation that you would get in Scenario 1 ??

Your thoughts...