It has been awhile since I’ve been here and the discussion Forum seems a little dead, but I’ll take a chance.
The area I live in has increased in price and mostly priced me out of rental investments. When I can find a decent deal, it becomes a bidding war with several other people and usually escalates to an above average price. I am lucky that I was able to get some great deals several years ago and I’m still doing very well with my 4 rental houses, my duplex, and my triplex. My equity has doubled or tripled on most of my properties so I’m pretty happy about that, I just am not finding anything additional I’m able to add to my portfolio at the moment.
So I’m looking outside my area and talking to a wholesaler. In St. Louis I’ve found a 12 unit apartment, 1 bed units, 100% occupied for $300k. After running all the numbers, figuring 10% maintenance, 7% vacancy, 10% management fees, average common area utilities, trash, insurance, taxes, and mortgage, it looks like a 42% cash on cash return based on 20% down on a 20-year note.
It sounds great, like a no-brainer, which is probably why I haven’t pulled the trigger on it yet. The neighborhood has average crime for St. Louis rated 46 out of 77, and lower family income. Other houses in the neighborhood sell very cheap, sometimes around $30k. I’m just very leery buying something out of state in an area that I don’t personally know. I don’t want to become a slum lord. Anyone have any experience buying in St. Louis, good or bad? Thanks