How To Identify Bad "D" Or "F" Class Areas

How To Identify Bad "D" Or "F" Class Areas

Rental Property Investor · San Diego, CA · Member since 2014 · 1k+ posts · 2k+ votes

Hi all,

Since I was featured on Podcast 238 about a year ago, I have talked to many BP Nation Members asking me if they should buy this deal or that deal.  Here is a simple way to determine if a deal a broker is sending you is a good deal or really in a "D" or God Forbid in even worst an "F" class area.  Both are not acceptable.  Google Earth all commercial in a one block, two block, three block, four block, five block, and six block radius.  Look down at the street level.  If you see ANY Grafiti, broken windows, boarded up windows, unsavory characters loitering around etc...  

If that is what you see, you are in a "D" class area.  Why would you want to invest in this kind of area?  Would you feel comfortable if your 16 year old niece was walking in that neighborhood on a Friday evening at 9 pm?  If the answer is no.  Again, why would you want to invest there.  Those unsavory characters will be stealing your copper when you have a vacancy or robbing your tenants.  Why would you invest in a "D" or as I said, God forbid war zone "D" or "F " class area.  Don't fall for the Path of Progress scam brokers claim time and time again.

Swanny

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Realtor · Paterson, NJ · Member since 2017 · 134 posts · 97 votes
8y

Take the state's or the county's (whichever is higher) median income and divide it by two. That should give you the median income for a C and lower class neighborhood. For example:

NJ Median Household Income, 2016 = $73,702

$73,702 / 2 = $36,851 which is the median income for a C and lower area

The median income in Paterson is $33,000 as well as Newark, NJ. That's how you know it is a lower class neighborhood.

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