Oakland, CA · Member since 2017 · 133 posts · 58 votes
Most 4-plex and smaller apartment buildings are Class C- areas in Las Vegas.
Average rent: $500 per month.
If we try to convert a Class C- apartment buildings to a Class A/B+ properties in a Class C- area, will we be able to get Class A/B tenants for $700 to $750 rent?
Note: all the surrounding are very ugly Class C- buildings around you.
Your building may be is the only one class A/B building in that area.
Is it worth to buy a Class C- apartment building in a Class C- area? Then try to covert it to a Class A/B building?
Investor · Austin, TX · Member since 2013 · 933 posts · 1k+ votes
9y
Cathy,
Experts will tell you that the goal is to find properties you can improve and move up to match the higher quality area. Class B/C properties in A/B areas respectively makes sense, or areas that are gentrifying and in the path of progress on there way to higher quality areas. If the schools, streets, shopping and entertainment areas look like a C, attracting residents to pay the higher rates by upgrading the property to a A/B as you suggest (higher than the surrounding area) is typically not going to work out so well. Occupancy and rents will not likely meet your expectations. If you see an area undergoing transformation and in the path of progress that can work out but has risks in how that development progresses and in what direction. The lowest risk strategy would likely be finding that B/C property in stable A/B areas.