Poss. deal but properties are really cheap. Is that a bad thing?

[Robert Fountain]

I've read some articles on BP about buying properties that are very low cost.  Mainly that they attract certain kinds of tenants and turnover is higher.  Well there are 2 properties side by side 2/1 each and both are listed for 34K each. They both are occupied with long term tenants at 750 / month each.  

The numbers work at asking price and would net about 330/month each in profits and a 34% CoC ROI each. Now I believe they are both short sales as well so I could offer 30K each or less and I think they would be accepted.

The question is, if the numbers work well would you still shy away from truly cheap properties for the reasons stated above?

[Chris Erwin]

@Robert Fountain I would check with local property managers/Realtors to get a feel for the area if you are not familiar with it. You could check out some raw data in terms of crime reports on Trulia. I would say just because they are cheap, doesn't mean they are bad properties. Make sure whoever is selling them can provide a legitimate rent ledger showing rent is being paid on time. I would also ask to see the lease agreements and make sure there are active leases involved with the properties. You don't want to buy these to find out the seller just put a warm body in the property to claim they are rented and performing. Happy investing.