Originally posted by @Mike Zipf:
@Angelo MartBit of a strong generalization. Newark is pretty stratified between neighborhoods and recommending that someone go to the worst neighborhood and rent it to Section 8 as their first multi family is dangerous. I would agree that flipping in Newark is a bad choice just because the housing stock is so old and most have not had steady upkeep for 50+ years.
I'd just like to add to what others have said about the North Ward and the Ironbound (Down Neck if your talking to old Italians) is that even in those districts there are multiple neighborhoods. In the Ironbound there is the East Ferry, Riverside, North Ironbound, and South Ironbound. And even in the North Ironbound there are areas with low rise projects and lower income tenant base and areas with a high income white collar tenant base. If you take your time and drive around the area you will see these differences and they will be reflected in prices :)
First of all I am NOT generalizing, I am speaking the clear facts. I have foreclosed more properties in Newark then you could even imagine. Also, I have worked for a property Reassessement firm in the city and would inspect 30--50 homes per day. In addition, my entire family was born and raised there. Unfortunately, I have heard horror stories from homeowners that were losing their homes that is heartbreaking.
North Newark is a great investment if you are on the right block (this is know because I grew up near there) but prices have increased so much that it kills positive cash flow. Down Neck as my "Old Italians" (generalized statement) would say is awesome but once again prices are still too high that they kill cash flow at times. I personally know an investor that has (5) 3-Fam homes all near South 18 and Avon Ave with positive Cash flow working nice. This works great for him because he lives on South 18th and Hawks his properties. I have met other Successful landlord Near notorious South Side but its still a HUGE risk for a rookie to me. I know guys that flip properties but have qualified buyers lined up but that's not for me.
So when you say my strategy is dangerous, do you say it is Physically dangerous or Financially? Section 8 is guaranteed rent with a government agency that screens tenants so it's good security. As far as Physical danger, well that's another risk.
