I love this topic. Ill share my experience in columbus Ohio. I bought two duplexes last year 100% occupied. One for $15,500 the other for $16k. One rents for $800 and the other for $700. Both needed some work, mostly on the exterior. I left the tenants in place and started using a portion of their rent to upgrade the exteriors, new roof, new faux stone front, paint stucco, repair gutters, paint trim, and cut down over grown bushes and trees. So far this has worked great! The tenants pay for the upgrades with their rent and Im improving the property while cash flowing. I still have all the original tenants and they really seem to appreciate me putting time and money into making these properties have some curb appeal.
I know you don't go putting granite countertops into $20k properties but my theory is, if i upgrade the exterior and give a lot of curb appeal then the tenant is more likely to take pride in the property, take better care of their unit, and stay longer. These type of upgrades can not be ruined easily by a bad tenant. And when the tenant moves out it will be easier to rent out again.
When people say areas can vary street by street or hood by hood, they are right on the money. Ive found a small area in Columbus that fits this type of description where i purchased my duplexes. Its a low income working class area with no more that 5% vacant houses on the street or surrounding streets. But just 10-15 blocks over I would not touch. The way i did it was, I looked at some cheap properties in absolutely terrible neighborhoods where 50%-70% of the houses were vacant. That gave me a reference of what kind of properties I didn't want to invest in, so when i saw a property in a better neighborhood i felt confident in my purchase. When I drive down a street and i think to myself would these houses be easy to break into because of the lack of neighbors? If the answer is yes, then that area is a no go.
Just my experience thus far.
