I own 4.5 single family houses in the Erie County/Buffalo area at the moment. An article in today's Buffalo News describes the downward slide of population in most areas of the County. Buffalo and Cheektowaga (where 2 of the houses I own are located) have dropped 5.7% in population since 2000. Lancaster, which has grown 3.7%, is where I own my other investment properties. The other 2 locations where I own my home and share a home with my ex, are not listed.
The mantra of Realtors is "location, location, location" and I have had bad experiences buying and holding in bad locations before (i.e West Virginia where population of the city dropped 20% over the 19 years I lived there. My learning from that was to never buy and hold in an area of declining population.
I thought that if I "flipped" property quickly that I might get around that problem here. I've got one property as a "fixer-upper" at a really cheap price, while the second, in a nice neighborhood, has been renovated and is in "like-new" condition. So, in essence, I am conducting an experiment as to what kind of house will sell in a "bad" location.
At this point the houses in Lancaster and the town I live in seem to be have increased in value enough for me to profit by selling them (the one in Lancaster is lease-optioned at a $25k profit). The one in Cheektowaga could make a profit if I can sell it quickly, but I don't see that happening. The fixer-upper may stay on the market for months more (already 4 months with no one even looking these days).
I've had many calls from prospective sellers in the declining areas of greater Buffalo, but have not answered their calls. I know that many people make lots of money buying real estate in Buffalo. Out of town buyers see Buffalo as a great market, but I still am not convinced.
Update: another doom and gloom article in the Buffalo News about the number of vacant houses here - 39,000.