6 unit double triplex in a bad area

6 Replies

A rookie here..I'm super excited about the possibility of becoming a real estate investor. Currently I'm looking at a 6 unit deal in Turlock Ca HollyBrook Estates( double triplex) in a somewhat bad neighborhood. Anyone familiar with this deal and/or can help me figure out if it's worth it trying to rally up the $ for it??

What is your notion of a "somewhat bad neighborhood"? What are the elements that make it so? Can you exact change on these elements? Do you really know and understand the neighborhood and it's potential?

What do you know about the building and it's current occupants? Deferred maintenance? Neglected tenants? How well was the property previously managed? What is the current value and the potential value?

Matthew, are you looking to wholesale it, buy and hold it, value add and sell it?  As a new investor myself, I just passed on (2) triplex's that were awesome cash flowing. They were also in a D neighborhood. I thought, how bad could it be… ?  So, I drove there and just watched the comings and goings while walking the streets local to that property. 

  I realized then that the work needed to manage individuals who had such different lifestyles and ideas of "quality" of life would supersede any financial gains on paper.  Furthermore, collecting those rents may or may not be consistent, so the numbers could be more theoretical than real life.  

As a new investor, the "headache" factor may be overwhelming for a 1st deal.  
I would encourage you to drive there, walk around, talk to folks and see if that is the community in which you'd like to invest. 

I am looking to buy and hold it for a long period of time. Thanks for the input Marcia and Aaron! Marcia I will use those questions to develop a better idea of how to view the property and Aaron I will actually go and VIEW this property like a fly on the wall to see if it is a deal for me.. Appreciate the infor guys!

Originally posted by @Matthew Foster :

A rookie here..I'm super excited about the possibility of becoming a real estate investor. Currently I'm looking at a 6 unit deal in Turlock Ca HollyBrook Estates( double triplex) in a somewhat bad neighborhood. Anyone familiar with this deal and/or can help me figure out if it's worth it trying to rally up the $ for it??

Location, location, location.  

If you have listened to enough podcasts you would have heard numerous accounts by guest speakers and the hosts of BP that their biggest regrets have been buying in "bad neighborhoods and not renting to great tenants".  It is more difficult to get great tenants in bad neighborhoods. 

Although Detroit is the often cited example of cheap prices, potential great rents, etc. it can happen in any submarket bad area in any city.  The problem is vandalism/neglect before, during, and after renting it.  Then eviction issues for non-payment becomes a recurring theme.  Listen to podcast #65 (actually, listen to ALL OF THEM as I am doing).  Make your own spiral notebook of every tip as you learn it.  Then you have your own real estate strategy book of Do's and Don'ts. 

This is a Don't for me.  I'll let someone else attempt to make money is such area.

Looks like a great couple of buildings!  I am also interested in Turlock for the University, convenience to 99. Has a decent older downtown area and lots of  new construction along the freeway. Do the analysis of the property, I do think the price is high.  I think you will have a bigger pool of tenants looking for a nice newer property, but screen well!

The pictures look pretty nice inside, but no telling how old they really are.

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