Buy a 7000 dollar house or a renovated house for 35 000 dollar?

[Goeran Sonstrand]

Is it smart to buy a house for, let say, 7 000 dollar, renovate it, find tenants and then let a property manager do the day to day work?

Or, in the case you dont live in Buffalo your self, buy a fully renovated house for let say 35 000 dollar with tenants and then find a property manager?

How much does it normally cost to do the necessary renovations for a "7 000 dollar" house, to make it ready for tenants?

Anyone here who has experiences of these two strategies? Run down, cheap house or renovated house?

[Account Closed]

Be careful in markets like Buffalo, regardless of whether or not you buy turnkey. Some of my small desert town markets here in CA have companies selling over-priced turn-key rentals, many to Scandinavians. My husband grew up in Sweden and currently works on projects in Norway. We have been made aware of the limited passive income opportunites there, and we can understand how investing in US real estate is attractive. However, buying $35K rental properties in cities like Buffalo or Dayton or Scranton or Barstow is fraught with potential pitfalls.

I advise you to visit any of the cities you are seriously considering. Gather lots of rental data and get it from sources other than the seller and property management companies. Don't spend $7K or $35K without a clear understanding of all the potential costs of owning and maintaining a rental in the US.