Signs of Gentrification

Charlotte, NC · Member since 2014 · 241 posts · 21 votes

since many cities are facing Gentrification I was wondering are there any signs a neighborhood or city is about to gentrify? What is the best time to invest in Gentrification post/mid/pre Gentrification? As a wholesaler can I take advantage of Gentrification?

0 Reply

85 views

Most Popular Reply

Dominick Adolfo

Chicago, IL · Member since 2014 · 28 posts · 10 votes

10y

Hipsters...

4 Reply

See this reply in the discussion

28 Replies

Jump to latestLatest

Sort by

Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
10y
Best time is before the run up and prices. Signs of gentrification are often bars/restaurants moving into an area, the demographic shifting younger, newspaper articles about the neighborhood being up and coming.
[email protected]301-893-4635 Podcast Guest on Show #192
District Invest Group545 Reviews
Website View Page
4 Reply
Chris Carollo
Western Springs, IL · Member since 2012 · 81 posts · 38 votes
10y
In Chicago I always paid attention to what type of retail, bars and restaurants were going in. More starbucks than dollar stores, probably an area that is getting gentrified. I also would drive the alleys to see what types of cars were parking behind the buildings.
2 Reply
Ryan Canfield
Real Estate Agent · Chicago, IL · Member since 2014 · 173 posts · 85 votes
10y
Like Chris mentioned above, Starbucks' in the area, trendy restaurants, art galleries, "hipsters" are things that I'm seeing in Chicago neighborhoods that are transitioning.
2 Reply
Dominick Adolfo
Chicago, IL · Member since 2014 · 28 posts · 10 votes
10y
Hipsters...
4 Reply
Chad K.
OP
Charlotte, NC · Member since 2014 · 241 posts · 21 votes
10y
@Russell Brazil @Ryan Canfield @Chris Carollo @Dominick Adolfo thank you guys for your feedback, I'm in the Charlotte, North Carolina area. I've had my eyes on a few spots an noticed some urban areas that comps are starting rise. My plan is to start a mailing campaign to those neighborhoods.
0 Reply
Ryan Canfield
Real Estate Agent · Chicago, IL · Member since 2014 · 173 posts · 85 votes
10y
Chad - what kind of properties are you going to target and how are you going to do so?
I've recently started to think about sending letters but haven't decided the type of owner to market to.
0 Reply
Chad K.
OP
Charlotte, NC · Member since 2014 · 241 posts · 21 votes
10y
@Ryan Canfield if I were you I would do some research on your city, take some advice from the individuals that have commented on this subject. One way I found a place that was gentrification ready is the weird comps of homes were you see new homes being built but surrounded by old homes
1 Reply
Ryan Canfield
Real Estate Agent · Chicago, IL · Member since 2014 · 173 posts · 85 votes
10y
Hi Chad - I more so meant, what type of mailing campaign are you going to do and how are you getting your list? Driving for dollars, Listserve, high equity, no equity, that sort of thing.
0 Reply
Chad K.
OP
Charlotte, NC · Member since 2014 · 241 posts · 21 votes
10y
@Don Harris ok I will
@Ryan Canfield it just depends on your budget, drive for dollars is a cheaper route and will give you somewhat of a exclusive list, definitely high equity, absentee owner 3 bed 2 bath 1500 square feet but it would be good to ask your buyers what they want.
0 Reply
Al Williamson
Rental Property Investor · Sacramento, CA · Member since 2011 · 2k+ posts · 1k+ votes
10y
Hey @Chad K.
2 Reply
Flavio Zanetti
Investor · Andover, MA · Member since 2015 · 269 posts · 67 votes
10y
My very best rule of thumb for signs of gentrification is a Starbucks moving in... They are usually a year or two ahead of the market when it comes to gentrification and higher prices.
Also, they do have a great team of real estate experts and researchers looking and studying communities before they open a store.
Keep your eyes open for that green store opening up!
1 Reply
Chad K.
OP
Charlotte, NC · Member since 2014 · 241 posts · 21 votes
10y
@Al Williamson and @Flavio Zanetti thank you for your feedback I will be on the look out for Starbucks and up keep of those neighborhoods
0 Reply
Audrey Truesdale
Wholesaler · Charlotte, NC · Member since 2013 · 269 posts · 66 votes
10y
Chad Kennedy there a several areas here in Charlotte that are being gentrified/revitalized I would just be careful to really understand the value lines and also rehab cost in these areas... Feel free to reach out if I can be of any help...
0 Reply
Chad K.
OP
Charlotte, NC · Member since 2014 · 241 posts · 21 votes
10y
@Audrey Truesdale there definitely is a lot of upside to Charlotte, thank you again for your feedback
0 Reply
Sloane Rowan
Investor · Charlotte, NC · Member since 2016 · 35 posts · 14 votes
10y
If you don't mind my jumping into this thread, I am interested in everyone's opinion on gentrification vs revitalization here in Charlotte?
0 Reply
Crystal SmithPro Member
Moderator
Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes
10y
Originally posted by @Chad K.:

since many cities are facing Gentrification I was wondering are there any signs a neighborhood or city is about to gentrify? What is the best time to invest in Gentrification post/mid/pre Gentrification? As a wholesaler can I take advantage of Gentrification?
I see you've received answers in this thread about looking for indications like enterprises like Starbucks moving in , or the neighborhood getting younger.... Usually by this time the gentrification has already started. Unless you're a big developer or part of the power structure that helps define what neighborhoods will be developed I believe its a crap shoot trying to guess pre-Gentrification.
The specific trend we look for is when the hipsters/young people feel priced out of the gentrified neighborhood & they start moving into the adjacent neighborhood.
312-681-7487
0 Reply
Steve Johnson
Flipper · Kansas City, MO · Member since 2017 · 24 posts · 37 votes
9y
I know this is old, but I agree with @Crystal Smith . Once Starbucks is there you are well behind the curve.
Ways we monitor are watching local papers, planning meetings, studies, and one of the best is your local business journal. Most major metropolitans have them. They are invaluable in my research as a residential investor as well as my knowledge of projects as a commercial/multi-use new construction contractor.
3 Reply
John Hickey
Rental Property Investor · Chappaqua, NY · Member since 2015 · 1k+ posts · 947 votes
9y
I agree with Steve Johnson and Crystal Smith If Starbucks is open I might be thinking to sell. I'm sure it's good for some to buy after but I'm trying to maximize profits. I don't know if there are any experts in gentrification(pm me of you are!)but it's a great thing to be able to predict. I'm not sure if I can say I'm able to predict but I keep trying. I've seen it in Miami, Brooklyn, lower east side, soho. This is what I think you need to get gentrification. The area has to have well built real estate, in other words no low income housing. Sustained period of being negatively viewed, 50 years is a starting point in NY. Lots of vacant or burned out property. In my view if you don't have lots of vacant/abandoned property gentrification will be slowed down. Nearby an area that is considered ideal neighborhood. Artists/musicians have begun to move in. I'm not talking about established art galleries or established artists. Struggling artists are what I look for. I cruise yelp for restaurants/shops. I look at the reviews. I try to find people coming from hip/affluent neighborhoods coming to less affluent areas. I got this from a study Cambridge university did where they were able to correlate gentrification with increased chatter in social media. I'm sure there are folks out there that consider gentrification to be a bad thing. I think it's a natural part of the real estate cycle. I think it should be taught in school so that people that own property in gentrifying areas can take advantage of the opportunity it presents. Try to hold on till the top of that cycle.
1 Reply
Cheryl Fielding
Investor · Brooklyn, NY · Member since 2016 · 35 posts · 24 votes
9y
My feeling is also that when Starbucks arrives it's time to sell! Starbucks in my experience is always late to the party. I think these are pretty good signs of gentrification: - bodegas begin to renovate - supermarkets change slowly what they are stocking (e.g. They have a small specialty cheese section) - hipster coffee shop - first nice wine store - A CVS or Duane Reade - sometimes a mainstream bank like TD
3 Reply
Anthony GaydenPro Member
Rental Property Investor · Omaha, NE · Member since 2014 · 2k+ posts · 3k+ votes
9y
Just look for a trendy neighborhood in your area. Now look at the neighborhoods that are very close to that neighborhood where housing prices are much lower. You may notice that a few other ambitious investors have already started flipping houses there. That is a good sign.
Podcast Guest on Show #21
0 Reply
Daniel Montes
Rental Property Investor · Brooklyn, NY · Member since 2014 · 92 posts · 17 votes
9y
In some areas means of public transportation to a major metro city.
0 Reply
John Hickey
Rental Property Investor · Chappaqua, NY · Member since 2015 · 1k+ posts · 947 votes
7y
@Daniel Montes hey just saw your post here! Time to bump this thread.
Anyone who posted here have luck tracking/predicting gentrification?
At the time I was working on some stuff as was faulty confident I could do it. Right around that tome I was 11 years in on buying in Bed Stuy. I was confident Bed Stuy was turning around when I bought. So in 2006 I was struggling to buy even as I was hearing from some wait the market was at the top. They were right. Top it was.
Didn’t matter tho bc BS went down for a few years then went through the roof. Speaking of through the roof. From what I’ve seen there are levels of gentrification. And then there is also exponential gentrification. Example. A place like Williamsburg Brooklyn. 30 years ago it was known as one of the most dangerous places in NY. Bed Stuy same. South Bronx same.....but south Bronx didn’t turn yet. I wouldn’t say it won’t ever but I dont think you’ll ever see it give RE returns like those two did. Maybe a different area of the Bronx will.
Anyway on gentrification. I had been searching for what I thought would be the next Bed Stuy since about 2009/2010. I looked at newburgh NY Hartford, new haven, Kingston, Poughkeepsie, Yonkers, Bridgeport, Bronx. ...I looked a bit in Brooklyn too but I wanted to buy a lot of houses....
So selling my bed Stuy property I bought a few million dollars worth of houses in Newburgh NY.
I remember posting about it on BP at the time and got a lot of push back from people saying Newburgh was going nowhere. Which I love to hear.
One of the things I would add to my 2 year old post is that you need to find a place that 99% of the folks say will never come back. I don’t know what but it seems the more people write a place off the more it’s a rocket ship.
Newburgh is up about 30% I. The last two years in some areas. But not where I bought. Some of my houses have doubled in 2 years. I’m fine tuning my research. Anyone have any info they would like to share?
2 Reply
Daniel Montes
Rental Property Investor · Brooklyn, NY · Member since 2014 · 92 posts · 17 votes
7y
Hi@John Hickey what are the cap rates in Newburgh an would you recommend a real estate agent there have a good day.
0 Reply
John Hickey
Rental Property Investor · Chappaqua, NY · Member since 2015 · 1k+ posts · 947 votes
7y
@Daniel Montes I don’t do too much multifamily and large commercial so I don’t really know the cap-rate in Newburgh
Right now I would say it’s going to be tough to buy for my numbers perspective the market is shifting so quickly you might have a hard time finding anything that makes sense on paper
But I do remember the same thing when I was purchasing two years ago things didn’t make a lot of sense on paper I just knew from my experience the signs of what was happening and I would say that’s going to continue I don’t think the markets going to go straight up there most likely like every market will go up and down
But I’m confident over the long term the prices were seeing now will make me wish I had bought more
It’s as clear as day to me now the year was about 2010 I was standing in front of two brownstones the seller wanted to give me for $400,000
200,000 each I was very short of cash. I had bought a few houses in the last two years everybody thought I was crazy I knew I was doing the right thing but knowing you’re doing the right thing won’t pay any bills
That’s the spot I’m in now same spot I see deals gone by I know they’ll make big bucks one day but what can you do I have a Lotta real estate up there already I would suggest anybody looking to make money over the long term they take a good look at the Newburgh market
I would love to hear from Jonathan what ended up happening in the Albany market I don’t pay any attention to it up there I’m sure he did well too. But I usually put money behind my predictions These days so when I call something it’s not me drinking a few margaritas and San I think this is going to happen or that’s gonna happen I have hard earned cash on the line.
Sounds funny when you say it like that I have a pretty big real estate portfolio for a guy with an eighth-grade education.
Originally I put down $30,000 about 13 years ago....that 30 was hard earned. The rest of it was pretty easily come by I guess.
1 Reply
Daniel Montes
Rental Property Investor · Brooklyn, NY · Member since 2014 · 92 posts · 17 votes
7y
@John Hickey It’s amazing like one property could snowball everything is Newburgh 1%rule or 2%rule.
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.