Newbie with an opportunity for a multi unit purchase

[Anne Laurenzi]

So, a property near me just posted a few hours ago. It's 6 units. 1 duplex that is 2bed/1bath and a 4-plex that are 1/1 each. They want $120k. At MINIMUM, I could get $600 for each duplex unit and $400 for single units. That's being very conservative. Without repairs and 20% down plus closing costs, I'd be in for $32k. This gives me about $600 cashflow and a cash-on-cash of 22%. That's if I go low on all the rents. I also went really conservative on the vacancy, repairs, and cap-ex. I drove past it and it looks like it's all rented out as of now.

Here's the catch. There are no pictures of the interiors and it is in a VERY low-income area. Obviously, I wouldn't buy anything sight unseen and would go look at all the units first. My concern is getting into way more than I can handle. Do I want to start my real estate investing career dealing with a low income property?

Here's a link to the property if you want to look at it. The street view makes it look a bit better than what it looks like now.

https://www.trulia.com/property/3275822033-6630-Applegate-St-Milton-FL-32570

Any advice/encouragement/discouragement would be really appreciated. If I get more pics or info, I'll update the post.

Thanks,

Mike

[Ronan M.]

Well there is low income and then there is scumbags. Not everyone can be a Zuckerberg or a Bezos.  Some people have to flip burgers and wait tables. That's just life. And probably many of those that do are as good as person as the big earners. They just live a different life.

I would try to find out if all the tenants are low income BUT working... or are they NO income and up to no good. That makes a huge difference. If you cut grass or flip burgers 40 hrs a week you can only about afford $500 to $700 a month in rent. But they are still putting in an honest week of work. 

Try to find out as much as you can about the current tenant base. And don't be put off by a couple that pay each month but pay a bit late. That's a fact of life in the low income demographic.

And also do this (and I am serious...I do it all the time) stop a patrol car on the street, preferably outside the building and ask them how many times they have been to that building in the last 12 months. If they can't recall ever being there things are looking positive. If the cop tells you they are there every other week...keep looking for another building.