I am looking at a property in Douglasville GA and the cash flow numbers are looking good, my real state agent convinced me that it is a good area.
But when I started looking at city crime data it is very high. Again I am a first time investor with very little to no background, BiggerPockets has been a good platform for information and I would like to get some inputs here
Hi @Vivek Mishra and welcome to BiggerPockets!
I'm willing to bet good money your real estate agent has never owned an investment property in their life! Once the sale is complete, they will grab their commission check and never be heard from again. Therefore, their opinion on the suitability of this property as a cash-flowing rental is less than worthless.
I suggest you listen primarily to other local investors and property managers in Douglasville, because they are in the business of building profitable rental portfolios.
I would be happy to suggest some folks for you to contact. Connect with me here on BP if you are interested.
Thanks @Mitch Messer , appreciate your response. I will reach out to you. Also the agent is from home union and they claim to have their own property management company.
Define crime report it high. If it is VIOLENT crimes that can many times be more concerning. For example upward trend of burglary, shootings, drugs, car jacking, homicide,etc.
If it is crime is non-violent in nature and slight uptick then generally is not as concerning as it can ebb and flow depending on population levels increasing, decreasing, or staying the same for an area.
Crime is just one component. Need to look at age of the building and the renter base.
Hi @Joel Owens ,
Thanks for your input, I looked at city data website and link is here
It is violent crimes, theft, burglary which is concerning for me as a first time investor.
You would need to check with the local police precinct for more up to date stats. The crime percentage index showed from your link 600's and has trended down some over the years but still higher than national average of 200's.
Some of these counties and cities can have trouble spots even though data is being posted for the whole area.
Sometimes it is better to pay a higher price for a better area then to stay in a low price point with problematic renters and older houses just for the sake of diversity with multiple properties.
@Joel Owens great point, although this is a new built in 2019 just completed with 170k value, rent was estimated to be around 1450 which was giving me cash flow of about 400, I was more than happy with that but what I am not sure about the uncertainty of maintenance and vacancy since this is not a great neighborhood, the agent marked it as b type so I was thinking it will be okay.
It's hard to build for anything less than 200k these days. You need to make sure this is a ground up build with pictures and not an older building re-skinned or given a face lift. Sometimes tax record will have built in 2019 for effective but really updated then and built in 1980's etc.
@Joel Owens how do we know or rather where can we find that record if it’s updated or build from ground up ?
Check with the county building and planning department. If it was brand new construction a whole process would have to have been applied for.