***Only exception is if an owner has plan & funds to reposition Class D to Class C or higher.https://www.biggerpockets.com/forums/776/topics/960183-what-they-dont-tell-you-about-cheap-rental-properties?

Might be worth your time looking for Phoenix's plan and try to invest in an area that may be considered C or D, but is having major city investments coming soon.

Honestly, there can be tons of drama at times.

If you wanted to bet on a water shortage you’d bet against California, that’s where you’ll see the largest damage.

Only a fool would jump into bed with partners with no agreement in place and liability protection.Also, do you FULLY understand the challenges of investing in Class C or D properties?

I could be wrong but I know i do virtually all my lending on accrual basis and we dont pay tax until we get paid off. if you payoff real early that's a massive pre penalty if you owe all that accrued interest Very few people would go for this deal i bet.. Only

My point is not EVERYONE can start at C or above.

I wouldn't bet on traditional RE investing, at scale, to be as passive as this one.

After how many years of this pattern would you bet on it?

So, they bought an OOS property (usually a freshly rehabbed A-grade house in a C or D area) because the house looked awesome in pictures, and the cashflow looked good on paper.