I think this area is depressed because of current market conditions as well as the quantity or forclosures on the market.

You've kind of depressed me, Don, with your explanation of the new Socialist REO system.Then again, J Scott has filled me with a bright new determination to fight past bank rejection until my bid is finally low enough.

The city I am investing in is a "depressed market", meaning no jobs are coming in and people are leaving.

Also, if you don't buy all 3 properties, and the market goes up and keeps going up, you won't be able to go back and get the 3 deals you can get now.I'm in SF Valley / Los Angeles, and we make hard money loans in both Riverside and San Bernardino, so I know how depressed your prices got.

The last one I did I am losing $140 per month and it is pretty depressing as it has higher rent than any other rental I have.

No depressed markets should be considered.

Other profit centers (mortgage paydown, appreciation which may be negative in your case, cash flow over the full life, and tax benefits) ... project them all out using long term average historic appreciation rates (CAGR over decades spanning multiple RE cycles, for both rents and prices) for that hood and compute IRR ... this will give you a much more complete and realistic picture of how the investment is most likely to perform.This is the analytical framework for how to assess the financials ... the important underlying question though is why are prices so depressed and not keeping up with inflation?

That will further depress prices.Share this with your government officials.

If the area is instead depressed then most tenants will not be a great selection and no matter how nice you make the property it will get trashed again.

I purchased the home over 3 years ago when the market was depressed though climbing upward.