New Investor in the Buffalo, NY area

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New Investor in the Buffalo, NY area

Derek Browning
Flipper/Rehabber · Las Vegas, NV · Member since 2015 · 2 posts · 1 vote

Hello BP,

My name is Derek and I've recently moved back to the Buffalo, NY (family is from here) area after spending the past decade across the border in Toronto.

I'm in the process of getting my 1st property, pre-approval for my Financials are set, and I will be looking at properties starting this Sunday (yes, sacrificing a football Sunday, so you know it's serious! Ha) 

This is such a knowledgeable community and a priceless resource that any insights, or possible partnerships would be more than welcomed...

My current plan is to purchase a 2 or 3 unit (which I will occupy as well) and I'm currently looking in the 14216 North Buffalo, North Park, Kenmore, Amherst, Tonawanda areas. Elmwood village is great but a little pricey for me at the moment, thinking about West Buffalo as well close to Richmond but not as familiar with the areas enough to feel confident (I know it's going into a Renaissance mode but like any city, has its good and bad pockets)

For 2016 I plan to buy at least 2 more properties, ideally 1 as a flip and 1 SFH rental, then continue to multiply my output moving forward.

Any suggestions, insight, tips, or contacts would be much appreciated, may you all have a wonderful and prosperous day ahead of you.

Best Regards,

Derek Browning

1Reply
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Most Popular Reply

Sam Tato
Wholesaler · Buffalo, NY · Member since 2014 · 17 posts · 7 votes
10y

Hi Derek, welcome! I'm also a new investor and I had some recent insight that I wish I knew when I bought my first property a year ago.  I'm not sure what type of financing you are planning to use but I'll tell you what happened with me.  I used a 5% down conventional loan to purchase a double in the 14216 Buffalo area.  The only reason I was able to get 5% down was because I was going to be living there and there are special terms and rates for owner occupied.  I'm now looking for a second property and I was hoping to move into the new one in order to secure the same type of financing.  What I have come to find out is that banks will almost always see the second multi-unit property as an investment property, which requires 25% down, and will not acknowledge owner occupied status unless there is a very good reason for you moving (i.e. closer to work for a shorter commute, moving to a single family from a double, more space for a spouse and kids, etc.) Since I am looking in the same area I have no credible reason to obtain an owner occupied loan and will need to use investment property financing.  

I work in the city, so in hindsight I could have bought a property in the suburbs and then bought a double closer to the city as my second property using owner occupied financing and use the reason that I'm moving much closer to work which saves time and money (gas).  But, since I didn't do that I will now need to use a 25% down loan for my next property and I am looking for private money much earlier than anticipated!  Plans change! 

Hopefully this will save you from the misconception I had!

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  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
    10y

    Welcome to BiggerPockets Derek and good luck investing!

    Podcast Guest on Show #121
    0Reply
  • Dmitriy Fomichenko
    Solo 401k Expert · Anaheim Hills, CA · Member since 2012 · 18k+ posts · 6k+ votes
    10y

    @Derek Browning

     Welcome to the BP family! You came to the right place to learn all about real estate investing! Here are some recommendations for you:

    Find and connect with other BP members that are in your area: http://www.biggerpockets.com/meet

    Set up keyword alerts to be notified of the topics that interest you: http://www.biggerpockets.com/alerts

    Read Beginner’s Guide: http://www.biggerpockets.com/real-estate-investing

    Check out BP Podcasts: http://www.biggerpockets.com/renewsblog/category/podcast/

    If you wish to tag someone in the conversation on the forum, type @ followed by their name and then select the name of that person which should appear below the comments box. He or she will be notified of being tagged so that the conversation will continue.

    Wishing you the best!                                                      

    0Reply
  • Sam Tato
    Wholesaler · Buffalo, NY · Member since 2014 · 17 posts · 7 votes
    10y

    Hi Derek, welcome! I'm also a new investor and I had some recent insight that I wish I knew when I bought my first property a year ago.  I'm not sure what type of financing you are planning to use but I'll tell you what happened with me.  I used a 5% down conventional loan to purchase a double in the 14216 Buffalo area.  The only reason I was able to get 5% down was because I was going to be living there and there are special terms and rates for owner occupied.  I'm now looking for a second property and I was hoping to move into the new one in order to secure the same type of financing.  What I have come to find out is that banks will almost always see the second multi-unit property as an investment property, which requires 25% down, and will not acknowledge owner occupied status unless there is a very good reason for you moving (i.e. closer to work for a shorter commute, moving to a single family from a double, more space for a spouse and kids, etc.) Since I am looking in the same area I have no credible reason to obtain an owner occupied loan and will need to use investment property financing.  

    I work in the city, so in hindsight I could have bought a property in the suburbs and then bought a double closer to the city as my second property using owner occupied financing and use the reason that I'm moving much closer to work which saves time and money (gas).  But, since I didn't do that I will now need to use a 25% down loan for my next property and I am looking for private money much earlier than anticipated!  Plans change! 

    Hopefully this will save you from the misconception I had!

    1Reply
  • Derek Browning
    OP
    Flipper/Rehabber · Las Vegas, NV · Member since 2015 · 2 posts · 1 vote
    10y

    I appreciate the warm welcome.

    Thanks Sam for the excellent advice, I knew about the occupancy status but I wasn't sure about how the banks' viewpoint is on the matter, valuable tip there.

    0Reply
  • Mark Nolan
    Professional · Carlsbad, CA · Member since 2012 · 12k+ posts · 1k+ votes
    10y

    @Derek Browning

    Welcome to the Bigger Pockets community. It is a great place to learn about real estate.

    0Reply
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