Grouper

Home Prices from the 70s: A Good Investment?

So I was looking at a house that was listed at 225K. Marginal neighborhood, busy street, rough condition, close to a lot of low/mid level jobs (households making $50K to $70K) . I figured with some work it was rentable for about 1200 to 1400 per month. My offer would have been in the $125 to $135 range (95 to 100x monthly rent). Closed today for $175K. I suspect it is a rental. Taxes will be $300 per month, insurance $150. Generously, $950 per month net = 6.5% ROC. I don't know what it means, but I am not a buyer at that yield. Will be interesting to see what happens.