Are you looking to build cashflow, to have a place to move to later, etc.With that said, here are some considerations:1) Transferring title (you buying the house) will trigger a reassessment (higher property taxes), which will significantly affect any potential cashflow.

Prop 2 and a new potential acquisition (Prop 3) are adjacent lots zoned for multi-family, presenting a unique opportunity to develop several townhouses on these combined lots.The challenge?

E.g. if you're buying $40-150K houses, out of state... your traveling costs alone would eat into any potential profits you will make. 

Each strategy has its own set of benefits and drawbacks, as well as potential returns and risks.Buying to Flip for Quick ProfitBenefits:Quick Returns: Flipping properties can potentially yield quick profits, especially in a hot real estate market.Minimal Holding Costs: Since the goal is to sell the property quickly, holding costs such as property taxes and maintenance expenses are minimized.Creative Freedom: Flippers have the freedom to renovate and design the property to maximize its resale value.Drawbacks:Market Volatility: Flipping is highly dependent on market conditions, and a downturn in the market can lead to reduced profits or even losses.Capital Intensive: Flipping often requires significant upfront capital for purchasing, renovating, and holding the property until it sells.Income Tax Implications: Profits from flipping are typically taxed as short-term capital gains, which may result in higher tax liabilities.Buying for Rental Income and Long-Term InvestmentAdvantages:Steady Cash Flow: Rental properties can provide a consistent stream of income through monthly rent payments.Appreciation Potential: Over time, rental properties have the potential to appreciate in value, providing long-term wealth accumulation.Tax Benefits: Rental property owners may benefit from tax deductions on mortgage interest, property taxes, and depreciation.Challenges:Tenant Management: Dealing with tenants, maintenance, and property management can be time-consuming and requires effective management skills.Market Risks: Rental income may be affected by market fluctuations and changes in rental demand.Liquidity: Unlike flipping, rental properties may not offer immediate liquidity, as selling a property can take time and incur transaction costs.Comparing Potential Returns and RisksBoth strategies offer the potential for attractive returns, but they come with different levels of risk.

But even these will only find 90% of the potential problems.

Would this potentially trigger a tax reassessment on the property?

Real estate has a lot more involved - loan paydown, potential tax advantages, time spent since it is quite a bit more "hands-on" than the stock market, repairs/maintenance etc.

Any deal with upside potential (expense reduction, renovations to drive revenue, undermanaged property, etc) the in-place cap rate may hold very little relevance to the deal.Per your follow-on question about generating higher returns: you are 100% right.  

Maxwell AFB’s presence in Montgomery is definitely an important factor, though keep in mind that just 12,500 people (out of roughly 386,000 people in metro Montgomery) work for the Air Force.As for the difference between the two cities, I’d say that there’s slightly higher appreciation potential in Birmingham.

If these places are generating positive cash flow, what potential red flags should an investor be on the lookout for?