Newbie in Philadelphia

[Kale Good]

Hello,

I'm looking into Buy-and-Hold but am not sure if I've got the finances to do it. I'm self-employed and pretty low earner (but a pretty frugal person), so I don't have a lot of excess cash flow. However, what I do have is time; my current work is very high paying (but relatively low hours).

- I have aboue 10-20k that I could put down, but that would basically exhaust cash reserves

- A 50K mortgage would be payable out of the excess earnings from my business with a moderate margin of safety (after paying the rent for the place I live and work out of, see note below). 

- While I haven't been pre-approved yet, I've been ballparked at 125K as the max loan I could take out. 

I work out of my apartment and clients come to me (many of them walk, actually). Due to the nature of the business, I can't move too far or into a rough neighborhood or I will almost certainly loose many clients. This, of course, removes the possibility of moving in and fixing something up. 

I've been considering buying in low-income areas; I know some people hate it. However, I think there are some things that work for me (although I want to look into it some more):

- cheaper properties

- higher ROI

- higher time commitment (keep in mind that I have more time than the average Joe). 

Thanks in advance for any help. 

[Brendan Markle]

Hey @Kale Good!  Welcome to BP.  I'm a real estate agent who operates in the Philly region.  

Considering your self employed status, I think if you can find a good deal in a low income area, I would go for it.  I have a duplex in Frankford, a place known for crime and low quality tenants, and I have had virtually no problems in the 11 months i've had it.  As long as you do your due diligence when selecting tenants, and are willing to put your foot down when you need to you will be fine.  

Let me know if you have any questions, or just want someone to talk to about investing!