Okay, here goes.  I too have purchased a few in some dodgy areas which are cash flow positive.  Namely, Davoren Park in Adelaide.  From what I hear the place is rough beyond a doubt but the area is changing with new infastructure happening and capitol growth is reasonable.  I also have one in Dubbo in NSW in an area of low socio-economic status with HC tenants but I have not had a problem with them paying their rent, as Sonya said it is paid directly by centrelink via direct debit.

As long as you have a good property manager and good insurance there should be no problems.