I am fairly new the the BP forums but have been doing some research for quite some time. I was wondering if there is anyone on here who has done some investing in Multi-Family properties in the Greater Boston Area. If so, does anyone have any tips, or things to look out for? Any information would be greatly appreciated. I live in New Hampshire so I am not to far from Boston so I am familiar with the towns but not so familiar with the investing at this point in these locations.
Also, please note my partner and I will be occupying one unit and plan to rent the other units. We love being in Boston and with the FHA loan requirement we must occupy the building. We plan to hold this property for some time.
Thanks in advance!
Anthony, there are lots of MA and Boston area investors on the BP forums. The search feature on BP will become your best friend: notice that the results are separated into different types of results, ie forums, people, etc.
Also, set up your keywords (look in the upper right corner of this page) to include 'boston', 'new hampshire', 'massachusetts', 'ma' 'nh' to be notified when people post including those words. You'll quickly see that there are lots of local investors. And the topic of moving into a multi is what Brandon calls house hacking, and is one of the best ways to start investing. It's especially helpful in an area with high price points like ours. I've done local presentations on exactly that topic.
Hi Anthony. House hacking is a fantastic strategy - I wish I won that battle with my wife years ago when we bought our first house :)
One thing to watch out for with house hacking is your criteria. You are buying a place for you and your partner to live and that's awesome, but you are also buying your first investment property. Those are two different sets of criteria that could be in conflict. My recommendation: first and foremost establish your INVESTOR criteria: how many units, what terms, is your criteria to make money when you buy? If so you need to buy at a discount to market value, what does that criteria look like? 5, 10 20% below market? What do you require for cash flow and ROI?
Nail down that investor criteria and then evaluate property through that lens and remain committed to your criteria! Example, you find a place you like, great. Now run the numbers on CF and ROI as if it were strictly a rental, ie look at what you would get for rents if you didn't live there.
Your stay there is temporary as you said, so make sure the deal is going to make sense when you leave and it is a buy and hold.
Your first deal is an important one, establish your investor criteria and be firm, this is not your forever home so listen to the investor angel on your shoulder that loves the numbers, not the other voice on the other shoulder that loves the kitchen and is willing to pay a premium.
Remember, if and when you sell you will very likely be selling to an investor who will make offers based on numbers. When that day comes you don't want the investor angel tapping his toe on your shoulder whispering "told ya so!"
Locate and attend 3 different local REIA club meetings great place to meet people gather resources and info. Here you will meet wholesalers who provide deals and rehabbers (cash buyers). South of Boston there are meetings in Rockland, Plymouth and Cape Cod. There are many west and north of Boston.
Two Great reads, I bought both J. Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbook
Consider checking out HUD homes for small multi's owner occupied gets first crack.
Download BP’s newest book here some good due diligence in Chapter 10. Real Estate Rewind Starting over
I'm doing the same thing right now. I'm looking for my first multi family deal in NH. I'm obtaining it with a FHA loan because of the low down payment. With that, as you said, you must occupy it (I believe for only a year in NH).
I would definitely recommend going to a REI group meet up. I went to my first one in Nashua a couple weeks ago and it was great!
Do you have a real estate agent? If not, maybe ask around on the forums for an investor friendly agent in the area.
Best of luck to you!
@Brett C. I just wanted to say thanks for that recommendation. I'm looking to buy a MF in the Newport Rhode Island area for my first HouseHacking adventure and what you said about getting the investor criteria established first really struck a cord with me. Again thanks!
Thanks so much for saying that Ron. I lived in Newport for 3 years, I'm jealous!!! Greatest place on earth, good luck!
Good luck @Anthony Simboli ! My wife and I are looking at doing the exact same thing, buying a multi and living in it, in the Boston area. We're seeing so far it's a tough market! Most properties in the neighborhoods we're looking at (Dorchester, Quincy) don't come close to cash flowing or even meeting the 1% rule unless you've got at least 3 units, and all are updated. It's been a fun adventure so far, and we've barely started!
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