Thoughts on buying first property in lower income area?

Question

Thoughts on buying your first property west of the river in Milwaukee? I found a decent triplex that makes sense (will cashflow $100 with me living/managing) but will need a new garage eventually.

I have primarily looked east of the river, but I need a place to live in 4 months and I’m sick of paying someone else’s mortgage!

Any and all advice on the garage, location, or lower income first property is greatly appreciated!

Marcus Auerbach · Answer

@Nathan LebherzNot a fan. If you do stay west of Holton. But there are better areas that still don't cost what you'd pay East of the river.

Careful with makeshift triplexes: third unit in the attic of a duplex are often not permitted and if they are built out as a hot roof and half the contractors don't know how to do that.

New 2 car garage with service door per code, window and EDO and power runs about 25-27k.

Alec Marquette · Answer

2 blocks west or 2 blocks east of Kilbourn Park? As silly as that seems it makes a huge difference. I'd be comfortable buying east of the park but not west. Obviously everyone has their own criteria but a place that is cash-flowing only $100.00 in that area wouldn't be worth it to me. Likely to have a lot of turnover which will eat into your cash flow, especially west of the park. If the east side is too expensive I'd look at the southside west of 43 and south of Oklahoma or south of Howard especially, if you could afford it. North of Oklahoma it start to get sketchy. East of 43 you are getting into Bayview which is a little inflated in my opinion. There  some decent cash-flowing duplexes in this area for under 200k (good if your putting less than 5% down) and crime isn't too bad. A lot of people have lived in these south side neighborhoods their whole lives. Some areas, especially closer to Oklahoma have been getting worse, but it's still no where near as bad as the north side. Just my two cents...

Nathan Lebherz · Answer

Marcus,Thank you very, very much for your time and detailed response. That triplex is actually 2 blocks away from Kilbourn Park, so east of Holton.I have definitely seen some tough triplexes with an attempt at using the attic. And thank you as well for an estimate on the garage. I will not have the cashflow to support such a large investment for a while.

Everything is telling me that patience will pay off for my first place. My current plan is to pick the location and wait for the house. Thanks again for your amazing insight Marcus