Hey guys, I'd like to throw in my two cents for what it's worth. I've been buying in Salem since earlier this year and I am finding cash-flowing deals. My bread-and-butter is buy and holds. I will buy a property at a discount, rehab the property with an economical budget, and rent it out for cash flow. As the end of a 3-5 year period I will sell the property and 1031 the proceeds into another market or a bigger building.
In terms of cash-flow I prefer to find deals that are at or near the 1% rule. For example, if my purchase price is $190K and I put $10K into the house my "all-in" price is $200K. If I can get $2,000 back each month in rents I consider that to be a good deal (1% x 200K = $2,000).
While it's difficult to find those types of deals in Salem you can get close and still cash flow. I purchased a FSBO 4 bedroom/2 bathroom single-family home for $180K earlier this year, paid $5K in closing costs, and put about $10K into the rehab. I was all-in at $195K. I am currently getting $1,700/month back in rents. As others have said above, the demand for rentals in this city is currently very high. This is different from the Salt Lake market where I started. In that market was "all-in" at around $150K for a comparable property and getting $1,500/month back in rents.
Salem is a strong play from a buy and hold standpoint because inventory is very low and demand is really high. Why? Portland has become unaffordable for many (median home prices of $400K for 4 bed/2 bath!) and Salem is a close commuter market (45-minute drive). Oregon is seeing significant in-migration from a younger population and those people are here to stay for the long-term (think about all of the Portland millennials who are now living in apartments who will want that white-picket fence single-family home one day).
In my opinion, what @AndrewJurinka said above is correct in that duplexes and multi-units are better cash-flowing deals than single-family homes. The duplexes that I have purchased in Salem do have better returns from a cash flow standpoint but in general they don't appreciate quite as well as the single-family stuff. I like having a portfolio of both single-family and multi-units because it gives you the equity in the up markets and the cash flow you need to hold the properties and weather those down markets.
There are a lot of flippers and developers in town so that is always going to be an option in Salem if you want to go that route. However, you will have to be careful as we have seen a lot of appreciation over the past few years in this market and at some point it's likely things will start to cool down.
