Lots of cheap housing around here, how to get started

I have known for quite a while that money can be made in real estate, and live in an area where there is plenty of low priced housing that can be rented out at fairly good monthly rates. Many of the homes are duplexes or upstairs/downstairs 2 family houses, which would generate even more income than a single family home. There are literally hundreds of houses on the market for under 20K, and rental rates are in the 500-700 dollar range. Theoretically you could purchase properties for $200-300/mo and rent them out for $1000-1400 monthly. Obviously you cannot expect to make $800-1100 monthly since there will be expenses, tenants not paying etc, but I am really not interested in dealing with the whole landlord headache.

Many houses are listed for even less than that, but there is a problem that is rampant in this area, and that is crackheads breaking into houses with no tenants and stealing all the copper plumbing. My question is, are there would-be investors looking for fairly cheap properties that need fixing up that they can rent for a decent profit each month? For instance, I have found quite a few of the houses listed for under 10K needing plumbing(about 7-10K) and the comps in the area are around 30-40K. Would it be possible to say get the house for 6-7K, turn around and sell it to a private investor for 10-12K, have them fix it up(plumbing, etc) and make 3-5K off of it? There are literally endless numbers of houses in this area I would be able to do this with if there is a market for this sort of thing…

any advice would be appreciated. Would it better to look at wholesaling the properties or are the values too low to do this? Would it be worth buying the properties and having plumbing installed? I don’t have much money to put into them, certainly no enough to have all the plumbing installed and paid for up front. Are their lenders that would give you the money or roll it into a mortgage? Obviously there can be a lot of money made with the houses being this inexpensive, but what is the best way to go about doing it?

Any help would be appreciated…

Matt

Matt, based on what you’re saying I’d definitely look into wholesaling these houses. The key will be finding an investor who has cash (or preferably several investors with cash) that want to buy in that area. Sounds like the areas you describe are not conducive to owner occupants, so the investors you locate will probably be landlords.

Here’s your formula: Get em under contract so cheap that you can sell em so cheap that the landlords just can’t resist. Check the wholesaling forum for more info on the specifics on wholesaling.

Well I would assume investors would be very interested both in this area and a very nearby city as well, as they are both currently ranked in the top
5 cashflow markets in the US…houses can be bought cheap, fixed up and then rented out at fairly decent rates that can make up an investment within a few years.