New member looking to BRRRR upstate NY
Member since 2024 · 6 posts · 5 votes
New member looking to BRRRR upstate NY
Most Popular Reply
Stephanie JacobsonBusiness Member
Real Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes*cracks knuckles*
Alright, here we go.
What are your goals? You can find a market in New York to accommodate pretty much any investment style. The three markets I know the best are Syracuse, Binghamton and Ithaca, and they're radically different. I understand the capital region, the Adirondack region, and Western New York (Rochester and Buffalo) have their strengths and weaknesses, but I'm going to focus on this central part of the state.
Binghamton is my favorite investment market for a few reasons, but it's not for everyone.
STRENGTHS
- low prices
- blue collar overall, meaning lots of resources for contractors
- growing university, consistently growing rents
- I expect to see an actual 10% cap rate here, higher if the property needs work
- compared to downstate, permitting, evictions, etc. are simple and quick
- no code compliance inspections required on existing multifamilies
WEAKNESSES
- no. natural. appreciation. Like at all. Do not bank on it. It just won't happen
- low ARVs even if you do renovate. Be very careful when calculating for a refi or sale
- recent zoning changes have been confusing and ridiculously restrictive for student housing
- some properties are $50k for a reason, run
- it looks... bleak. And depressing. It's fine. We're used to it.
- lots of downstate absentee landlords have let properties go to crap. Don't do that
Summary: Binghamton is the best market upstate, hands-down, for cashflow. It's the easiest to work in as far as regulations and rehabbing. Student rentals really drive the market, but thanks to recent zoning changes, legal student rentals are incredibly hard to come by. If you choose to buy here, pay very close attention to zoning, and run your BRRRR numbers conservatively. Rent varies wildly depending on condition, who your tenants are, and where your property is located.
Ithaca is like another planet.
STRENGTHS
- appreciation is pretty much guaranteed, no matter how crummy your property is
- student housing isn't restricted, they'll live anywhere
- having an ivy league school means there's a lot of money flying around
- rent is high
- tons of development and growth going on
- strong STR performance outside the city proper
WEAKNESSES
- almost absurdly high prices
- similarly absurdly low cap rates
- pesky annual inspections required on multifamily properties
- most deals happen behind closed doors, and agents tend to be very unhelpful
- 5-7% cap rates typical, sometimes lower
Summary: Ithaca is a great market to park your money in and wait. You don't have to do anything to your property, it will sell for higher than you bought it for last year. If you have a pretty place that's furnished nicely, you can rent to students for more than $1100/bed, which can add up for large, older homes with many bedrooms. Watch out for those pesky annual inspections, though- they'll get you just because they feel like it, after letting the last owner slide for some twenty years.
Syracuse is a sort of happy medium between the two.
STRENGTHS
- strong affordable housing market
- cool city with a great feel
- nicely mixed neighborhoods with properties in need of repair next to nice homes
- large university, robust medical community
- decent rents overall, currently trading at 8-10% cap rates
- Micron promises growth
WEAKNESSES
- Micron hype is making people spend way too much on properties
- pesky code compliance inspections here too
- student housing area is incredibly compact and difficult to get in to
- difficult to predict if a property will benefit from renovation or not
- contractors are overwhelmed, difficult to get estimates
Summary: Syracuse is experiencing a lot of change right now, in a good way. They're anticipating the entire landscape being changed by Micron over the next few years, which is cause for plenty of optimism and excitement. You're rolling the dice a little bit, banking on that though, so when just starting out, stick with a solid rental that's performing well enough within commuting distance from Clay.
Alright, hope that helps! I'd love to see some other agents/investors weigh in on Rochester, Buffalo, Albany and other cities up here. Good luck @Marika Aubrey, keep us posted!
16 Replies
- 2yMarlon FongPro MemberBiggerPockets Support · Bridge City, TX · Member since 2016 · 1k+ posts · 367 votes
Welcome to the site @Marika Aubrey! It's great to have you here.
Here are some recommendations for you:
Find and connect with other BP members that are in your area: http://www.biggerpockets.com/m...
Set up keyword alerts to be notified of the topics that interest you: http://www.biggerpockets.com/a...
Read Beginner’s Guide: http://www.biggerpockets.com/r...
Check out BP Money Podcast: https://www.biggerpockets.com/..
Wishing you the best!
- Member since 2024 · 53 posts · 11 votes2y
Quote from @Marika Aubrey:
Excited to be learning here!
I'm Manhattan based but wanting to BRRRR upstate.
Hit me with your advice and wisdom 🙏
Hi Marika,
Happy to answer any questions you may have. Feel free to reach out!
Best,
- 2yStephanie JacobsonBusiness MemberReal Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes
*cracks knuckles*
Alright, here we go.
What are your goals? You can find a market in New York to accommodate pretty much any investment style. The three markets I know the best are Syracuse, Binghamton and Ithaca, and they're radically different. I understand the capital region, the Adirondack region, and Western New York (Rochester and Buffalo) have their strengths and weaknesses, but I'm going to focus on this central part of the state.
Binghamton is my favorite investment market for a few reasons, but it's not for everyone.
STRENGTHS
- low prices
- blue collar overall, meaning lots of resources for contractors
- growing university, consistently growing rents
- I expect to see an actual 10% cap rate here, higher if the property needs work
- compared to downstate, permitting, evictions, etc. are simple and quick
- no code compliance inspections required on existing multifamilies
WEAKNESSES
- no. natural. appreciation. Like at all. Do not bank on it. It just won't happen
- low ARVs even if you do renovate. Be very careful when calculating for a refi or sale
- recent zoning changes have been confusing and ridiculously restrictive for student housing
- some properties are $50k for a reason, run
- it looks... bleak. And depressing. It's fine. We're used to it.
- lots of downstate absentee landlords have let properties go to crap. Don't do thatSummary: Binghamton is the best market upstate, hands-down, for cashflow. It's the easiest to work in as far as regulations and rehabbing. Student rentals really drive the market, but thanks to recent zoning changes, legal student rentals are incredibly hard to come by. If you choose to buy here, pay very close attention to zoning, and run your BRRRR numbers conservatively. Rent varies wildly depending on condition, who your tenants are, and where your property is located.
Ithaca is like another planet.STRENGTHS
- appreciation is pretty much guaranteed, no matter how crummy your property is
- student housing isn't restricted, they'll live anywhere
- having an ivy league school means there's a lot of money flying around
- rent is high
- tons of development and growth going on
- strong STR performance outside the city properWEAKNESSES
- almost absurdly high prices
- similarly absurdly low cap rates
- pesky annual inspections required on multifamily properties
- most deals happen behind closed doors, and agents tend to be very unhelpful
- 5-7% cap rates typical, sometimes lowerSummary: Ithaca is a great market to park your money in and wait. You don't have to do anything to your property, it will sell for higher than you bought it for last year. If you have a pretty place that's furnished nicely, you can rent to students for more than $1100/bed, which can add up for large, older homes with many bedrooms. Watch out for those pesky annual inspections, though- they'll get you just because they feel like it, after letting the last owner slide for some twenty years.
Syracuse is a sort of happy medium between the two.STRENGTHS
- strong affordable housing market
- cool city with a great feel
- nicely mixed neighborhoods with properties in need of repair next to nice homes
- large university, robust medical community
- decent rents overall, currently trading at 8-10% cap rates
- Micron promises growthWEAKNESSES
- Micron hype is making people spend way too much on properties
- pesky code compliance inspections here too
- student housing area is incredibly compact and difficult to get in to
- difficult to predict if a property will benefit from renovation or not
- contractors are overwhelmed, difficult to get estimatesSummary: Syracuse is experiencing a lot of change right now, in a good way. They're anticipating the entire landscape being changed by Micron over the next few years, which is cause for plenty of optimism and excitement. You're rolling the dice a little bit, banking on that though, so when just starting out, stick with a solid rental that's performing well enough within commuting distance from Clay.
Alright, hope that helps! I'd love to see some other agents/investors weigh in on Rochester, Buffalo, Albany and other cities up here. Good luck @Marika Aubrey, keep us posted! - Member since 2024 · 6 posts · 5 votes2y
Wow! Great info. I thinking I want to focus on Albany/Schenectedy, so curious to hear from those sinking time and money into these areas…?
- Real Estate Agent · Member since 2023 · 831 posts · 577 votes2y
Hey Marika, I'm originally from Queens, New York. If you're looking Upstate, have you considered out-of-state?
I found Cleveland, Ohio. It's a strong cash flow market. It is landlord-friendly, and specific pockets have gone upwards of 2-4x in the last 5-10 years. A ton of BRRRs opportunities if you're sourcing off-market.
You can find off-market single families in the 80-120k price range, and duplexes are in the 100-180k price range. - Member since 2024 · 6 posts · 5 votes2y
Down the track, I’m open to out-of-state, but initially I want to be on the ground. I had a negative experience buying and leasing in another state and felt frustrated to not be close by. But that was 15 years ago and I’ve learnt loads since, so I’m open to it in the future.
- Real Estate Broker · New York, NY · Member since 2020 · 2k+ posts · 1k+ votes2y
Hey @Marika Aubrey - I'm a broker & investor in NYC, but actually invest upstate too.
Shoot me a DM if you want to chat further, upstate is better for cashflow, but not as much for appreciation - so it depends on what your goals are.
- Investor · Rochester, NY · Member since 2015 · 499 posts · 169 votes2y
I invest full time in Rochester NY--It is a very solid market--Very strong cash flow and upward appreciation.
- Real Estate Agent · Member since 2023 · 18 posts · 13 votes2y
Quote from @Marika Aubrey:
Wow! Great info. I thinking I want to focus on Albany/Schenectedy, so curious to hear from those sinking time and money into these areas…?
Hi Marika! I am an agent in the Capital region, so I cover Albany/Schenectady/Troy/Saratoga and surrounding areas. Appreciation is VERY strong here. Property values are strong. So it isn't going to be cheap to get into something in this area, because there are a lot of buyers and investors to compete with. Even the gut job properties are listed and go pending very quickly because there is a lot of money to be made in the region.
Albany -
There is an area in Albany that is convenient to both numerous hospitals and colleges. It is a very strong area for rentals. You can do both basic housing aimed at students (they usually aren't hard to impress, just want a safe place to sleep - they don't need fancy and usually won't maintain fancy) and higher-end housing geared towards all of the professionals who work at the area hospitals, and everyone who works in Albany area in general. It all works in this area. Because things are so strong here though, it will be hard to get into anything at a low price unless you are willing to do some renovations. Property taxes are high relative to the assessment values also.
Schenectady
There are colleges, hospitals, and other workplaces in the area as well. Downtown is making a huge comeback, attracting lots of new businesses and generally going through a revitalization. I would say it has less interest in it than Albany area though still strong. Similar to Albany in that taxes are pretty high relative to assessed values and market values.
Comparing the two, I'd say Albany is always going to be the more popular area. Looking at the MLS, 379 MF listings sold in the city of Albany during the last 12 months, compared to city of Schenectady at 241. County-wide, 549 sold in Albany and 268 in Albany. As far as rents, I know the MLS is not the usual or only place for rentals, but again comparing MLS closed rentals for the last 12 months from today, the average monthly rent for Schenectady county was $1,673. Albany was $1,790, for a smaller average space.
If you'd like to discuss investing in the Capital Region further, feel free to message me any time!
- 2yStephanie JacobsonBusiness MemberReal Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes
Quote from @Stefanie Gouvis:
Quote from @Marika Aubrey:
Wow! Great info. I thinking I want to focus on Albany/Schenectedy, so curious to hear from those sinking time and money into these areas…?
Hi Marika! I am an agent in the Capital region, so I cover Albany/Schenectady/Troy/Saratoga and surrounding areas. Appreciation is VERY strong here. Property values are strong. So it isn't going to be cheap to get into something in this area, because there are a lot of buyers and investors to compete with. Even the gut job properties are listed and go pending very quickly because there is a lot of money to be made in the region.
Albany -
There is an area in Albany that is convenient to both numerous hospitals and colleges. It is a very strong area for rentals. You can do both basic housing aimed at students (they usually aren't hard to impress, just want a safe place to sleep - they don't need fancy and usually won't maintain fancy) and higher-end housing geared towards all of the professionals who work at the area hospitals, and everyone who works in Albany area in general. It all works in this area. Because things are so strong here though, it will be hard to get into anything at a low price unless you are willing to do some renovations. Property taxes are high relative to the assessment values also.
Schenectady
There are colleges, hospitals, and other workplaces in the area as well. Downtown is making a huge comeback, attracting lots of new businesses and generally going through a revitalization. I would say it has less interest in it than Albany area though still strong. Similar to Albany in that taxes are pretty high relative to assessed values and market values.
Comparing the two, I'd say Albany is always going to be the more popular area. Looking at the MLS, 379 MF listings sold in the city of Albany during the last 12 months, compared to city of Schenectady at 241. County-wide, 549 sold in Albany and 268 in Albany. As far as rents, I know the MLS is not the usual or only place for rentals, but again comparing MLS closed rentals for the last 12 months from today, the average monthly rent for Schenectady county was $1,673. Albany was $1,790, for a smaller average space.
If you'd like to discuss investing in the Capital Region further, feel free to message me any time!
THANK YOU for posting some actual sound info and data on these markets!
- Member since 2024 · 6 posts · 5 votes2y
Quote from @Stefanie Gouvis:
Quote from @Marika Aubrey:
Wow! Great info. I thinking I want to focus on Albany/Schenectedy, so curious to hear from those sinking time and money into these areas…?
Hi Marika! I am an agent in the Capital region, so I cover Albany/Schenectady/Troy/Saratoga and surrounding areas. Appreciation is VERY strong here. Property values are strong. So it isn't going to be cheap to get into something in this area, because there are a lot of buyers and investors to compete with. Even the gut job properties are listed and go pending very quickly because there is a lot of money to be made in the region.
Albany -
There is an area in Albany that is convenient to both numerous hospitals and colleges. It is a very strong area for rentals. You can do both basic housing aimed at students (they usually aren't hard to impress, just want a safe place to sleep - they don't need fancy and usually won't maintain fancy) and higher-end housing geared towards all of the professionals who work at the area hospitals, and everyone who works in Albany area in general. It all works in this area. Because things are so strong here though, it will be hard to get into anything at a low price unless you are willing to do some renovations. Property taxes are high relative to the assessment values also.
Schenectady
There are colleges, hospitals, and other workplaces in the area as well. Downtown is making a huge comeback, attracting lots of new businesses and generally going through a revitalization. I would say it has less interest in it than Albany area though still strong. Similar to Albany in that taxes are pretty high relative to assessed values and market values.
Comparing the two, I'd say Albany is always going to be the more popular area. Looking at the MLS, 379 MF listings sold in the city of Albany during the last 12 months, compared to city of Schenectady at 241. County-wide, 549 sold in Albany and 268 in Albany. As far as rents, I know the MLS is not the usual or only place for rentals, but again comparing MLS closed rentals for the last 12 months from today, the average monthly rent for Schenectady county was $1,673. Albany was $1,790, for a smaller average space.
If you'd like to discuss investing in the Capital Region further, feel free to message me any time!
Stephanie and Stefanie - THANK YOU for so much detail and insight!!! Really grateful.
- Investor · Miami Beach, FL · Member since 2017 · 362 posts · 109 votes2y
Hi Marika, welcome here! feel free to ask questions. :)
- Real Estate Agent · Member since 2023 · 18 posts · 13 votes2y
Quote from @Stephanie Jacobson:
Quote from @Stefanie Gouvis:
Quote from @Marika Aubrey:
THANK YOU for posting some actual sound info and data on these markets!
Of course - I loved reading your post as well. Super in depth, and helpful as I don't know much about those markets by you! They sound quite similar actually, being college towns with strong economies outside of them as well!
- 2yStephanie JacobsonBusiness MemberReal Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes
Quote from @Stefanie Gouvis:
Quote from @Stephanie Jacobson:
Quote from @Stefanie Gouvis:
Quote from @Marika Aubrey:
THANK YOU for posting some actual sound info and data on these markets!
Of course - I loved reading your post as well. Super in depth, and helpful as I don't know much about those markets by you! They sound quite similar actually, being college towns with strong economies outside of them as well!
Yes! I have folks ask about the capital region and I don't cover it, so I'll drop you a message about referring some folks to you.
- New to Real Estate · NYC · Member since 2020 · 9 posts · 7 votes2y
Quote from @Stephanie Jacobson:
*cracks knuckles*
Alright, here we go.
What are your goals? You can find a market in New York to accommodate pretty much any investment style. The three markets I know the best are Syracuse, Binghamton and Ithaca, and they're radically different. I understand the capital region, the Adirondack region, and Western New York (Rochester and Buffalo) have their strengths and weaknesses, but I'm going to focus on this central part of the state.
Binghamton is my favorite investment market for a few reasons, but it's not for everyone.
STRENGTHS
- low prices
- blue collar overall, meaning lots of resources for contractors
- growing university, consistently growing rents
- I expect to see an actual 10% cap rate here, higher if the property needs work
- compared to downstate, permitting, evictions, etc. are simple and quick
- no code compliance inspections required on existing multifamilies
WEAKNESSES
- no. natural. appreciation. Like at all. Do not bank on it. It just won't happen
- low ARVs even if you do renovate. Be very careful when calculating for a refi or sale
- recent zoning changes have been confusing and ridiculously restrictive for student housing
- some properties are $50k for a reason, run
- it looks... bleak. And depressing. It's fine. We're used to it.
- lots of downstate absentee landlords have let properties go to crap. Don't do thatSummary: Binghamton is the best market upstate, hands-down, for cashflow. It's the easiest to work in as far as regulations and rehabbing. Student rentals really drive the market, but thanks to recent zoning changes, legal student rentals are incredibly hard to come by. If you choose to buy here, pay very close attention to zoning, and run your BRRRR numbers conservatively. Rent varies wildly depending on condition, who your tenants are, and where your property is located.
Ithaca is like another planet.STRENGTHS
- appreciation is pretty much guaranteed, no matter how crummy your property is
- student housing isn't restricted, they'll live anywhere
- having an ivy league school means there's a lot of money flying around
- rent is high
- tons of development and growth going on
- strong STR performance outside the city properWEAKNESSES
- almost absurdly high prices
- similarly absurdly low cap rates
- pesky annual inspections required on multifamily properties
- most deals happen behind closed doors, and agents tend to be very unhelpful
- 5-7% cap rates typical, sometimes lowerSummary: Ithaca is a great market to park your money in and wait. You don't have to do anything to your property, it will sell for higher than you bought it for last year. If you have a pretty place that's furnished nicely, you can rent to students for more than $1100/bed, which can add up for large, older homes with many bedrooms. Watch out for those pesky annual inspections, though- they'll get you just because they feel like it, after letting the last owner slide for some twenty years.
Syracuse is a sort of happy medium between the two.STRENGTHS
- strong affordable housing market
- cool city with a great feel
- nicely mixed neighborhoods with properties in need of repair next to nice homes
- large university, robust medical community
- decent rents overall, currently trading at 8-10% cap rates
- Micron promises growthWEAKNESSES
- Micron hype is making people spend way too much on properties
- pesky code compliance inspections here too
- student housing area is incredibly compact and difficult to get in to
- difficult to predict if a property will benefit from renovation or not
- contractors are overwhelmed, difficult to get estimatesSummary: Syracuse is experiencing a lot of change right now, in a good way. They're anticipating the entire landscape being changed by Micron over the next few years, which is cause for plenty of optimism and excitement. You're rolling the dice a little bit, banking on that though, so when just starting out, stick with a solid rental that's performing well enough within commuting distance from Clay.
Alright, hope that helps! I'd love to see some other agents/investors weigh in on Rochester, Buffalo, Albany and other cities up here. Good luck @Marika Aubrey, keep us posted!Thanks for spending your time making the pros and cons list, definitely helpful. I'm currently looking in the Ithaca Market.
- 2yStephanie JacobsonBusiness MemberReal Estate Agent · Ithaca, NY · Member since 2016 · 429 posts · 324 votes
@Jimmy Bermeo fantastic! I'll send you a DM.
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