I was responding to the OP of the thread ... who's account has since been closed and his original post disappeared.What I implied in my above response is that gross revenue is only part of the picture in determining if a property is a "deal" and that even a high ratio of revenue to purchase price is meaningless without knowing the operating costs.That said, we have purchased properties (tax sales, mortgage sales, etc) where the operating expenses are unknown and the revenues could be zero (i.e. vacant property).  

I’d focus on that rather than risking $$ in unknown out of state markets.

Moral of the story, for an unknown third party seller you may want an attorney to review the contract to make sure you have protections.    

Knowing which areas to focus on is just a small factor but there are many local issues that are unknown to most. 

Somebody wanting to sue for you backing out of a bad deal or accusing you of selling them a property with defects like unknown termite damage).

At my early stage there are unknown unknowns - things I don't see yet in an analysis. 

your first property is the scariest.. but the second isn't that scary.. after 3, it just turns into fun because the unknowns get minimized.    

The title company sent out an email yesterday saying they found some issues with the foreclosure and there were some unknown spouses that were not named in the foreclosure.  

The only choice we had in the matter was to evict HIM for breech of contract which would include all unknown occupants.

Instead of how much down and an expense that's 2.5% of an unknown, we need to know the age, condition, class of area and the market cap rate of that class.