I'm a buy and hold investor and currently have 3 upscale condo/town home rentals in very nice areas, near major office parks and good jobs. All 3 stay rented with little to no vacancy and return between 9-12% per year on cash after expenses.

However the price point to enter this market is high and I see properties where I can earn in the 18-20% range by stepping down to an average quality rental in a "B" neighborhood. These are still decent neighborhoods, but have more foreclosures, lower home quality, just not as nice and will bring a tenant at a different income level.

I do my own PM, and have a full time job which is demanding so I need to minimize the amount of time it takes me to manage them. Does anyone out there have properties in areas that would compare to these? Or has anyone transitioned from one to the other? I'm curious to hear what your experiences have been, the pros and cons, etc, as I'm considering rethinking my investment criteria.