New to posting in bigger pockets but I've been browsing for quite a while now. I'm a pretty successful Realtor in PA but i'm new to investing. I'm looking at some row homes in York PA. I have 3 that I could purchase right now for around 28-35k a piece that rent for 795 a month and they pay all utilities. After what I considered "worst case scenario" with property management, I'm seeing a 20% cash on cash ROI. Believe I had 8% for vacancy, 10% repairs, 10% capex, and I can get decent property management for another 8%.
My question is, am I estimating too low for this type of area? I know normally from what I've seen on "deal of the day" or any other analysis, i'm definitely being safe. I don't consider it a war zone (cops still go there) and I can drive through without being shot at. Would I want to live there? No. It's also maybe a quarter mile from a private college. Although the crime map doesn't look great, you're not seeing homicides everywhere. It's in my opinion a D-Class neighborhood. I know other investors are in that area a lot as well. Some are even trying to flip.
I have around 20k to play with and think this is an ideal starting point for someone that wants passive income. Any feedback is appreciated. Thanks!
@Justin Harman I know people here in Cincy that invest in almost- war zones and do well. BUT, they are experienced. Areas like this may be a little less than ideal for the beginning investor. But then again, maybe you would excel at it. Tough to say, not knowing you at all. Something to keep in mind.