Making the numbers work for nicer homes
A coworker of mine has ~7 low income houses and duplexes, and I see the issues he has to deal with on a regular basis. Extended families moving in, criminal boyfriends living with the tenant, frequent evictions, etc. I know you'll encounter some of this with any rental, but I don't think it's a stretch to think that a slightly more expensive units will attract less-stressful tenants. The trouble is that I'm having trouble making the numbers work.
What I'm seeing in my research is that the $130,000 properties aren't renting for that much more than the $70,000 properties. We're talking a $400 spread or so. It's even less when I look at inexpensive duplexes.
Is it typical for the ROI on the less desireable homes to be so much greater, or is this a situation where the numbers really only work out when you buy distressed properties?