With the slow housing market in Indiana, I have been inundated with out of state investors looking to cash in on investment properties locally before the market heats up.
I get asked almost daily whether investors should purchase properties in questionable areas, but that have good cash flow, or purchase in newer or more expensive areas, but have less cash flow? IMHO, it always pays off to purchase in quality areas and spend more money up front and have less cash flow. AT the end of the day, 15-20 years from now, these less cash flowing properties will be worth much more, have caused less headaches, and have less tenant wear,tear, and neglect.
I have an investor that recently purchased investment properties in questionable areas, now he is having serious issues with tenants not paying, tearing the place up, etc. now he wants out.
In my experience with properties I own, it always pays to buy good properties, in good areas with good schools. I have been fortunate to have started this way in my investing career.