Can someone advise me if these types of investment should be avoided.

An opportunity exists to purchase a room in a motel for $95k less 10% dep. Income is $145 per week gauranteed and total outgoings are just $400 per Month.

This produces a postive cashflow of approx $13 per week after tax.

There appears to be little or no opportunity to increase the rent and captial growth is questionable. The only way that this investment will increase its return is by reducing the principal.

This establishment is in the middle of a backpacker and tourist strip in a capital city. Construction has also just begun on another similar premises next door.

Any help would be appreciated.