What am I missing with this property?

[Benjamin Otey]

Hey Guys!

I have a triplex for $85k in a rough neighborhood outside of a military base that I am considering buying to turn into section 8 housing. I have been learning about investing for the past five months but this would be my first deal. The current owner is the definition of a motivated seller and has dropped the asking price 30% over the past month. The agent told me that he needs to sell because he took out a hard money loan that is due. The median rent in the area is between $900-$1000 per door but the current owner is only charging $600. One of the three units is currently occupied. The property isn't in terrible condition but I estimate that I would need to put in between $10k-$15k of repairs to make the property appealing to live in. I feel like if I invest $100k into a triplex and back the property using section 8 housing, it would be a safe investment, despite the bad neighborhood. I told the agent that we would need to get an inspection done on the house before I move forward, but I'd like to hear your thoughts about section 8 housing, buying in tough neighborhoods, and what I am missing about this deal.  Several others have passed on the deal but I can't understand why. The seller's agent told me that the other buyers didnt like that the seller had to have 85k because of the loan. In my mind, I feel like I have found a great deal despite the issues with the neighborhood around the property and the repairs, but I am still cautious because I am so new. Thank you for your time!

[Nathan Gesner]

Quote from @Benjamin Otey:

Hey Guys!

I have a triplex for $85k in a rough neighborhood outside of a military base that I am considering buying to turn into section 8 housing. I have been learning about investing for the past five months but this would be my first deal. The current owner is the definition of a motivated seller and has dropped the asking price 30% over the past month. The agent told me that he needs to sell because he took out a hard money loan that is due. The median rent in the area is between $900-$1000 per door but the current owner is only charging $600. One of the three units is currently occupied. The property isn't in terrible condition but I estimate that I would need to put in between $10k-$15k of repairs to make the property appealing to live in. I feel like if I invest $100k into a triplex and back the property using section 8 housing, it would be a safe investment, despite the bad neighborhood. I told the agent that we would need to get an inspection done on the house before I move forward, but I'd like to hear your thoughts about section 8 housing, buying in tough neighborhoods, and what I am missing about this deal.  Several others have passed on the deal but I can't understand why. The seller's agent told me that the other buyers didnt like that the seller had to have 85k because of the loan. In my mind, I feel like I have found a great deal despite the issues with the neighborhood around the property and the repairs, but I am still cautious because I am so new. Thank you for your time!

If it's on the open market and nobody's making an offer on it, that's an indication that it's not worth the trouble. The market is hot right now and investors are buying up everything - and paying more than they should. This doesn't sound like a smart decision for an inexperienced investor.

Keep doing your research, but be skeptical.