New Investor Advice

[Vance La]

Looking to start my real estate investment journey and am deciding between various routes right now.

Background: living in Brooklyn NY. Currently making around six figures with no debt. Renting an apartment for about 3k a month.

Would love to try to buy a 1 bed /apartment condo (no co-op or HDFC) rn in an area that sees high potential of appreciation over the next 5-10 years. Strategy would be to put 10%+ down on an FHA loan for a property I would live in the next 2-3 years. Looking at properties which would be around a 3.2k to 3.5k all in housing payment, so a little more than what I pay for rent. Did some math on YoY rents in the area and after moving out I would most likely breakeven monthly or be a bit negative. (Not counting maintenance, Property managers, etc)

Ideally I would love to keep the property and rent it out and the goal is to move to San Diego after I move out. (I know that both these areas are not really the best in terms of landlord friendly). And continue to buy up properties in the area or out of state. Don’t know if I should just rent and save up more money.

Also looking at out of state areas like Hartford, CT and Charlotte, NC. (Continue renting and buying one or two properties in one of these areas)

Very new to all of this, have started to read some books, listen to podcasts, and discuss with friends who started a couple years earlier than me.

Any advice would be helpful, thanks

[Lydia Winn]

If you are set on the Brooklyn appreciation play, I'd look at Bed Stuy. It fits your criteria for growth better than almost anywhere else in the borough right now.

However, you need to be warned: This route is tricky.

Here is why Bed-Stuy is the right move for appreciation, but a headache for your specific financial constraints:

1. The "Block-by-Block" Variance

Bed-Stuy is not a monolith. It is huge.

• The Good: The areas near the A/C trains (nostrand/Franklin) or bordering Clinton Hill are prime and stable.
• The Tricky: Go three blocks east or south, and the vibe, safety, and tenant pool change drastically. 

2. The "New Construction" Trap

To find a condo (avoiding Co-ops/HDFCs) in Bed-Stuy, you will likely be looking at "boutique" new developments (small buildings with 4–10 units).

• The Tax Abatement Cliff: Many of these units rely on 421a tax abatements to keep monthly costs low. If that abatement burns off in year 5 of your 10-year hold, your taxes could jump from $50/month to $800/month, killing your cash flow just as you move to San Diego.

3. The Math is Tight (The $3.5k Ceiling)

This is the hardest pill to swallow. You want a $3,500 all-in payment with 10% down.

• The Reality: With current interest rates (~6.5%+) and HOA fees (~$500+), a $3,500 monthly cap limits your purchase price to roughly $480k – $520k.
• The Market: Decent 1-bed condos in Bed-Stuy often trade closer to $600k – $750k. To hit your numbers, you might be forced into a "garden level" (basement) unit or a smaller studio, which appreciate much slower than true 1-bedrooms.