95% of Investors Would Buy This Rental Property In Top 10 'Unhappiest' City Johnstown, PA. Would you?

This is the question we asked 379 real estate investors:

Would you buy a rental property for $100,000 ($30,000 + $70,000 renovation) that generates $2,067/mo rent and $1,500/mo free cash flow BUT is located in a top 10 "unhappiest" city? The city is Johnstown, PA.

95% responded Yes

Now this is an attractive investment from a cash flow perspective, but we were admittedly surprised that only 19 of the 379 investors polled would not do this deal.

The deal: ​714-714 1/2 Somerset St, Johnstown, PA 15901

• Property type: 3-unit
• Offered at: $30,000
• Estimated rehab: $70,000
• Monthly rent (Section 8): $2,067
• Cash-on-cash return: 20% - 23.5%
• Cash Flow: $1,500 per month

Johnstown, PA: Top 10 Unhappiest Cities In America

According to a study, "Unhappy Cities", published by the National Bureau of Economic Research, Johnstown, PA ranks 6th in the top 10 for the least happy American regions.

Johnstown City, PA by the numbers (US Census Bureau):

• Population (2019 estimate): 19,195
• Population change (2010 - 2019): -8.5%
• Persons in poverty: 39.7%
• Median household income: $24,294
• Per capita income: $16,383
• Bachelor's degree or higher: 12.5% (compare to 31.5% nationally)
• Owner occupied housing rate: 46.5%

Johnstown Housing Authority

We spoke with a Section 8 housing coordinator at the Johnstown Housing Authority who provided the following insights:

We are always in need of quality housing, there is a shortage in Johnstown. If these units were made available to the program, they would fill quickly.

Section 8 Rates (2021):

• 1 BR $572 per month (utilities included)
• 2 BR $724 per month (utilities included)
• 3 BR $923 per month (utilities included)

Would you buy this rental property?