I have several rental properties and am looking to expand. I don't see much discussion about where to buy in terms of neighborhood. My CAP rates are very good, however my properties are in an area that is not considered the best place to live, and while there are some signs of a potential revival, things could go either way. My question is, does that matter? Should I only be looking in neighborhoods on the rise, where the rent and property value will definitely go up? Or should I just focus on the individual deal & the near-future cash flow potential?
To the question of your topics: location, location, location
As to your question, it depends on your investment goals. Do you want cash flow vs opportunity to appreciation? Do you want the opportunity to apppreciate vs cash flow? Do you want both?
You get differing answers from different people because people have different goals. Those using real estate to provide their primary income need the cash flow to live on. Those using it as a retirement plan might be looking more for appreciation since they don’t need the cash flow to live.
Make sense? If you have decades to wait, historically on that time period, property values generally go up pretty well. Obviously, we’ve had some strange times in the past decade.
Hope that helps. Good luck