Hello from Atlanta!
I am looking at a bungalow (3/1) that looks great and needs very little work.
The purchase price is 45K, and it is on seemingly good street with no boarded houses, no bars on the windows, decent cars, kept lawns, etc. There other properties on the street valued at 70-90K.
Rent comps for this 3/1 show a median price of $875 on Zillow.
Taxes are around $500 for the year, and insurance is around $450 for the year.
The property is currently vacant.
The neighborhood is Historic West End, and it is not far from the Beltline (paved trail / transit / redevelopment project in progress encircling downtown ATL). The neighborhood seems to be gentrifying, but there are still a lot of vacant, run-down properties in the area.
What do you think? Is it a good time to get into a place like this? Or is it too risky? I'm looking to buy / hold.
@Joshua Feit The West End can be a very scary place for investors that are not very familiar with it. It really depends on what section of the West End you are in. There is one area that is great with prices that in the high $100K's with young professionals moving in. While other sections have not caught up in any way. It's hard to give you an honest professional opinion with out knowing the direct location
@Tyler Willis : Thanks Tyler. The property is EAST of the Beltline (West End Trail) by two blocks and just SOUTH of Lucile Street.
why not do a quick search of a local crime map? I almost pulled the trigger on a property yesterday, and then did a quick crime map search. When I saw all the crime was concentrated around that area, I decided to pass.
Tough area. Personally, I would look somewhere a bit more stable for your first deal...you say other properties on the street are "valued" at $70-90k. Are those recent closed sales or numbers from a valuation estimator?
Hi, Joshua: I find it helpful to think like my tenant. If they compare yours to others at $875 would they be enthusiastic about living there? It's also helpful to get a handle on your demographics. Is a person there who rents for $875 someone with a steady blue-collar job or a professional? This will usually indicate how much management you'll have to do.
If comps are truly 40-50% above the asking price, then why isn't it gone?
Lastly, there's nothing better than local knowledge as Tyler states. Good luck
Are you sure you can get $875. I do not find zillow, rentometer or any of those calculators to be accurate. I find my comps by watching houses that are advertised on the zillow, trulia, etc and comparing them to my house.
Hi Joshua - Rehab properties in the area sell for $30k $45k. I think I know the house you're looking at. It has historical charm and is in the better part of Historic West End ... not too close to MARTA and south of 20, North of White.
One bath could be a challenge for renters, but a 'cared for' house in the area will rent easily. You'll need to spruce it up to make the house more attractive to renters.
Get a thorough inspection to make sure you understand the condition of the home. I suspect there's quite a bit of deferred maintenance.
Let me know if you want me to look at it and I can show you a similar house in the West End I'm finishing.
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