George,I specialize in listing and selling apartments for my clients.What I posted was a down and dirty 10 second calculation.Typically costs average to 10% property management15% vacancy/loss turnover35% operating and expenses= 50%This doesn't include deferred CAPEX that the seller has put off to make their costs seem lower and profit seem higher.Buying acquisitions is a process through which you put a filter.When I was working with developers they would plot out about 10 locations on a map.I would pull the preliminary information and we would go visit the sites.From that step half of the properties would be crossed off for one reason or another.Eventually after multiple steps we would negotiate with 2 to 3 sites max.The developer would go with 1 site and maybe 2 if they could get both at great deals.The higher the dollar value on a deal the more scrutiny goes into it.Buying a quad versus a 200 unit apartment building has a totally different level of risk versus reward ratio.When buying a building you have to know in the immediate area how much vintage product you are competing against,versus relatively new product,versus new product slated for development where the plans and land is already bought and the developer is waiting to build to time the market.All of these factors among many others will affect the property you are contemplating purchasing.It doesn't make sense on the front end to do a 100 point checklist of due diligence when the seller might not even sell at a range where it would make sense.Do the down and dirty 10 second calculation and determine the sellers motivation and go from there.I know people who would spend hours trying to analyze a property only to find out from a quick phone call that the seller was unrealistic.Instead of wasting that time they could have found a motivated seller to conduct due diligence on with a deal that might happen.That's not to say the unmotivated seller will not be motivated at some point but you can't wait on that with your other plans.When they come back to you if all your capital isn't ties up you can look at it again.

I don't finance the vanilla stuff only heavy rehabs that the banks don't want (which we love - great value add deal is perfect).Advice to investors today is that it might be worthwhile to look at the unpolished gems as they seem to be trading at a steeper discount to market value (i.e. home owners are leaving the investment only product alone). 

Have I gotten lucky and found a gem for my first rental or am I taking on too much risk?

Additionally, if anyone is looking to invest in Kokomo, Indiana or the surrounding area (which I think is a hidden gem for investment properties), I'd be more than happy to help out in any way that I can!

A lot of the vintage buildings have doors they are getting rid of believe it or not!

-CrainsDetroit.com 2019•Detroit is one of the best hidden gem cities according to Expedia”-Metrotimes.com 2019•“More millennials are moving to metro Detroit” -Metrotimes.com 2019•”Detroit has seen tremendous growth over the past five years.”

The real gems are bought before the foreclosure process.

Right around that same time, my dad had his vintage airstream returned to him after a breakup. 

Hello AZ,My name is Gem, I'm a new/aspiring investor out here in Gilbert, AZ. 

Thought I would throw this gem out there.