how good is this location for a rental investment?

Asked by Venkat, San Jose, CA Sat Jun 25, 2011

how good is this location for a rental investment?

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This question is about this property: http://www.trulia.com/property/3047172083-112-W-Apache-St-Ph…

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7
Donald Crowl…, , Scottsdale, AZ
Sat Jun 25, 2011
BEST ANSWER
Brian,Gave you a great link to the crime rate website, that is not all there is to it.
Having sold many multi family properties
The first thing, if you are doing a drive by, is to look at the cars ( are they mostly old).
What is the condition of the landscaping of the property and the surrounding one.
One thing that is a dead give away that you should run is if you see a public telephone near be!!!
It is a VERY indicator that most people their do not have good credit.
Also, do not take the rents, vacant, and expenses at face value.
Many times , they will list MARKET rent, not the ACTUAL rent they are receiving.
Also I smell something rotten as far as the expenses of $1,500 annual! Can't be so!!!
Check the assessors office to see what their property taxes are?

Let me tell you a good rule of thumb I have used for many years when eveluating income properrty.

Assume a 10% vacancy
Assume 40% in expenses.
What's left over after servicing your debt.
Then you will have a good idea if the property is worth buying.
Also to remember!
Everything-roof-A/C,flooring etc. has a life expectancy so figure you need to set about 10% aside for capital improvements.

If you like, please contact me and I can help you with these kinds of properties. I can evaluate them very quickly.

Don Crowley
Realty One Group
602-206-6200
donazre@gmail.com
1 vote
Matt Puzz, , Phoenix, AZ
Mon Jun 27, 2011
Your definition of GOOD may be different from others. I guess you need to look at what can make the property location better or worse than others. What you can control are the amount of rent you receive and the the monthly costs of the property. Will you be buying the property for cash or placing money down and financing the rest. If you need assistance with financing I will gladly help you with that, call today to schedule a time. 602-410-9333.

Thanks.

Matt Puzz
Licensed Loan Originator
Amerifirst Financial, Inc.
1910 S. Stapley Drive #209
Mesa, AZ 85204
Direct: 602-410-9333
Office: 480-682-6617
Fax: 480-344-3687
NMLS# 213777 AZ LO-0915068
Apply Online: http://www.mattpuzz.com
Web Reference:  http://www.mattpuzz.com
0 votes
Jose Dias, Agent, Scottsdale, AZ
Mon Jun 27, 2011
This depends on what you consider good.

This property is located in a very central area in Phoenix, close to major freeways and downtown. It is close to a major hospital, which is usually a big plus when looking for renters.

Properties in this area usually rent fast because of the things mentioned above.

Another good thing going for this property is that it has 2 4-bedroom units, which will allow a bigger family to live there. This will likely increase your chances to rent them.

I haven't seen this property myself, so I don't know the condition of the units and how much work you would need to put in. This would be a very important piece of information to decide whether or not this would be a good rental property. Have you visited the property and made an assessment yet?

I have investor clients that love the area - cheap properties, easily rented; while others will not touch a property there.

And before I leave you, I have just noticed that this property has been on and off the market since the end of March 2011. The listing shows the cumulative days on market as 42, which may be misleading. I suggest you or your REALTOR investigate further. It is very uncommon for this type of property to stay on the market this long. However there might be a good reason.

Good luck!

Jose Dias, REALTOR
(623) 418-5700
Jose@MyFirstHouseAZ.com
Realty One Scottsdale
0 votes
Sonny Shriva…, Agent, Surprise, AZ
Sun Jun 26, 2011
Venkat,

Two of my buyer's agents, Ben and Linda Leahy, indicated that you are working with them. Did you ask them this question? They are investors themselves who have acquired a number of rental properties. They are a great resource - you should utilize them.

One suggestion is to check out the satellite map and street view on Google Maps. Judging by what's next door to this particular property, I would not recommend it.
0 votes
Sheryl Chiar…, Agent, Phoenix, AZ
Sun Jun 26, 2011
Hi,

Be sure to have someone you trust to help you make the decision if you can't be there to see the property yourself. Be sure they have your interest at heart and are not just trying to make a sale. Drive the area, are there job prospects nearby? What is the competition for rentals i.e., are they better equiped, newer or better cared for properties in the immidiate area that are charging the same rents you will charge in order to have a good cap rate? Are the units all rented or will you have some down time? Drive or have someone drive the area at a couple different times of day. Are there work aged men hanging about (jobless)? Are people hanging about in the parking area after hours? You don't have to want to live there but you want respectful tenants who want to live in a safe, quiet environment. Lots of factors to consider. I would be happy to help and have sold quite a few fourplexes, let me know if I can be of assistance.
Sheryl Chiaramonte
HomeSmart Realty
480-326-6201
0 votes
Jeffrey Masi…, Agent, Scottsdale, AZ
Sat Jun 25, 2011
Dear Ven:

This is in the central city, so there will be renters. The rents in this are are not high rents. They tend to be in teh $350 to $500 range. Yes, check the crime reports. Trulia's block by block crime report tool is very good.

In Phoneix low end rents are under $500, medium under $800 and higher are over $800.

Let me know if you have any other questions.

Jeff Masich, Realtor
Arizona Homes and Land
HomeSmart Realty
Scottsdale
Web Reference:  http://ArizonaHomesLand.com
0 votes
Brian Anders…, Agent, Scottsdale, AZ
Sat Jun 25, 2011
A good way to tell if the area is a good rental investment is by checking the crime rate in the area.
Trulia has a crime rate beta: http://www.trulia.com/crime/Phoenix,AZ/ ... it seems pretty accurate.
MLS shows that that property just reduced its price to $42,322. The property has 2 4-bedroom units, and rentals for 4 bedrooms in that area go for around $700.
So, that puts income at near $1400/ month in good conditions. The MLS also says it costs about 1500/ year to run. It looks like it would need some work.

Essentially, we can't tell you what is good or what isn't because we can't have a preference. We can provide you the facts.

If you are not comfortable with repairs required to bring this property to rental standards, or you prefer a property in an area with less crime rate, but still in your budget, I can help you.
Brian Anderson
602 319 8085
bja1987@gmail.com
Web Reference:  http://armls.com
0 votes
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