Should I buy or wait?

Question

So there's this property I've found that is in a not so great neighborhood but it's not the worst area. Anyway, the property would in theory produce a great amount of cash flow near 2k a month. My question is, would it be smart to invest in such a property? Also my original plan was to attempt the BRRRR strategy, but the whole not having done it before is discouraging. So, should I continue with my original plan or go for the cash flow?

Luke Carl · Answer

@Joshua Roberts

You posted on the wrong forum this is STR.

Need more info but yes you should buy.

BRRRR in my opinion is not much of an option in the current climate. Prices are high. And many folks think they can get an easy free house and don’t realize they’ll need, let’s just make up a number, 150 grand cash to get this thing going and hope they don’t make a mistake. Before you BRRR you should flip something with a goal of NOT losing money. Creating 20-25% equity your first time is just not going to happen.

My suggestion is find something that will or already is cash flowing 1% and buy it the old fashioned way with 20% down.

Don’t be afraid of bad neighborhoods. I love my low income stuff. It’s not for everyone but it works for me.

You’ve got to crawl before you walk. BUT you can go from crawl to run quickly if you read enough books.

Paul Sandhu · Answer

Why would anyone want to stay there if it's in a not so great neighborhood?  Generally speaking, not so great neighborhoods usually turn into bad neighborhoods more often than they turn into good neighborhoods.

I saw this happen in my own town.  Summer of 2007.  There was a flood.  Refinery had an emergency shut down.  A valve was left open and 5000 barrels of crude were released into the flood water.  About 500 residential homes were condemned and had to be demolished.  This was in the ghetto next to the refinery.  All the people in the ghetto were compensated by the refinery.  So now all these ghetto people moved to the other side of town.  Not so great neighborhoods became bad neighborhoods.  Average neighborhoods became not so great.  Good areas became average.  Several years later the Amazon distribution center here relocated and took away 1500 jobs.  A lot of people left town.  Now there are a lot of foreclosures in all types of neighborhoods.

Should I buy or wait?

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