NYC Rookie Investor looking for advise

New to Real Estate · NY · Member since 2024 · 1 post · 2 votes

Good day BP community. I'm here to network and grow my portfolio. Im house hacking in NYC and planning to get a HELOC to invest in the next 2-3 unit property. Currently I'm renting to friends so the stress and risk of non payment is minimal.... wondering if any NYC investors could share their strategies to mitigate these risks. I've heard some horror stories.

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Antonio Grzeca

Lender · CA · Member since 2025 · 18 posts · 3 votes

11mo

Morning Marisa! My advice as a loan officer is once you stabilize that next property with tenants, you might want to look into a DSCR (Debt Service Coverage Ratio) loan for the refinance or long-term financing piece. Instead of qualifying based on your personal income or DTI, the lender looks at whether the rent covers the new mortgage payment. It's a great way to keep acquiring properties without running into income limits, especially in higher-cost markets like NYC.

As for tenant risk, solid screening and clear leases go a long way — even when renting to friends. And if you ever move out and rent all the units, the DSCR route makes it easier to keep financing future deals based on property performance instead of your paystub.

Keep up the good work!

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Jason WrayPro Member
Banker · Nationwide · Member since 2020 · 2k+ posts · 1k+ votes
11mo
Marisa,
One piece of advice is consider investing out of NY and in other states like IN, OH, TN, FL, NV, MO, and more to get a better purchae to cash flow ratio. New York is an expensive state due to purchase prices, Taxes, and mostly LTR due to seasonal and winter months.
NY also carries a .25 rate add on to the rate or cost and unless you refinance using a CEMA loan you pay a ton more overall. Most of my NY, CA, CT, TX, investors focus on IN, OH, TN, FL, NV, MO for 2-4 unit properties but SFH as well. If you ever have quetions on states or neighborhoods feel free to reach out or email me any time.
[email protected]727-637-4289
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Antonio Grzeca
Lender · CA · Member since 2025 · 18 posts · 3 votes
11mo
Morning Marisa! My advice as a loan officer is once you stabilize that next property with tenants, you might want to look into a DSCR (Debt Service Coverage Ratio) loan for the refinance or long-term financing piece. Instead of qualifying based on your personal income or DTI, the lender looks at whether the rent covers the new mortgage payment. It's a great way to keep acquiring properties without running into income limits, especially in higher-cost markets like NYC.

As for tenant risk, solid screening and clear leases go a long way — even when renting to friends. And if you ever move out and rent all the units, the DSCR route makes it easier to keep financing future deals based on property performance instead of your paystub.
Keep up the good work!
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Abel CurielBusiness Member
Real Estate Agent · Queens, NY · Member since 2016 · 2k+ posts · 1k+ votes
11mo
Quote from @Marisa Woods:

Good day BP community. I'm here to network and grow my portfolio. Im house hacking in NYC and planning to get a HELOC to invest in the next 2-3 unit property. Currently I'm renting to friends so the stress and risk of non payment is minimal.... wondering if any NYC investors could share their strategies to mitigate these risks. I've heard some horror stories.

Hello Marisa!
Every landlord experiences non-payment and vacancy at some point but its good that you haven't had any issues thus far.

Aside from being your friends, what other factors make your current tenants relatively easy/stress-free to rent to?

Do they have solid incomes? Low debt-to-income ratio? Super high credit scores? Are they in a particular profession/industry, do they have a similar family size, etc? Do they have pets?

I would take the good characteristics of your tenants/friends and establish an ideal tenant/avatar moving forward. Set firm requirements and expectations for all your vacant units moving forward, so that any future tenants can closely resemble the current tenant class.

Location also matters. Some neighborhoods in NYC have stronger tenant pools than others. If you're looking to mitigate future risks, be super selective with the neighborhoods (or streets) you choose to invest in. The same would apply if you're looking to invest outside of New York as @Jason Wray suggested.
All the best!
Abel

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Mohammed Rahman
Real Estate Broker · New York, NY · Member since 2020 · 2k+ posts · 1k+ votes
10mo
Hi Marisa,
I'm Mo, a real estate broker and investor here in NYC and Long Island. Happy to chat and share any insights on this matter. Please don't hesitate to get in touch.
All the best!
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