Hello from Central NY

16 Replies

hello, I'm just getting into this.  In fact I go to look at my first possible investment property today.  I'm a little worried though because one of the largest employers in my town (Oswego, NY) just announced they are shutting down, essentially laying off over 500 people (engineers and other high paying jobs) in the next two years.  This is a huge blow to our economy.  I was thinking I wanted to invest locally, to maintain as much hands on as I could but now I don't know.  My town is a college town but we are not wealthy; our county has the states highest unemployment rate, even before the plant shut down. 

So, a question, actually two.  Is it possible to make money in a soon to be very down market?  And, if not, how feasible is it to invest out of state as a newbie?  I know how much I don't know which makes me very nervous but I also can't wait to get into this business. 

For some perspective, I have a full time sales job, I make good money, have three kids and want to start getting some passive income to a) pay for college and b) eventually get out of my current job.  So, I can't go all in, but I also can't afford to wait years to start this.

Thanks 

thanks for the hellos.  Just been listening to the podcasts and have downloaded the ultimate beginners guide.  I'm a little confused by what buying notes means so I need to look that up. This is all so interesting.  I just found out one of my high school classmates is on here and doing really well, such a small world.

@Tim Griffiths I'd be nervous too. If you get something close SUNY Oswego for a college rental you should be safer.  You really need to know the implications of this layoff. 

Alternately, you could invest here in Rochester.  The cash flow is generally better than central NY. And it isn't too far away for you to check on.  

Originally posted by @Larry T.:

@Tim Griffiths I'd be nervous too. If you get something close SUNY Oswego for a college rental you should be safer.  You really need to know the implications of this layoff. 

Alternately, you could invest here in Rochester.  The cash flow is generally better than central NY. And it isn't too far away for you to check on.  

 Thanks Larry.  Yeah, I'm thinking of something like that.  Also I'm originally from Schenectady county and I know that area is starting to see a bit of a renaissance and I still have contacts there including family so I may look that way.   My fathers house is on the market and priced as it is we've got it below market due to some work that needs to be done.  I'm thinking I may take it over, fix it up and put it back on the market hoping to make a bit more of a profit, either for me and siblings or I will just buy it outright.  It's in a good location with appreciating houses so if I can put some work into it, nothing major, I think we could make some good money back on it.

Lots of opportunities.  Rochester is intriguing too, but the demographics for the city are unknown so it would have to be some research on my part. Mthe good news is I have friends and family there as well who could do due diligence for me.  Exciting to think about for sure.

Welcome to biggerpockets! The plant closing in Oswego is a major blow to the entire region. Most of the people that worked there will probably leave the area as similar well paying jobs do not exist in Central NY anymore. For that reason I would not invest in Oswego unless you got a stellar deal on a house or apartment near the college and target the students as a rental. Just make sure that they are not going to build a large scale dorms anytime soon. SUNY seems to want to spend money lately across the state on new residence halls for students, probably so they can collect the room and board. 

Originally posted by @Steve B. :

Welcome to biggerpockets! The plant closing in Oswego is a major blow to the entire region. Most of the people that worked there will probably leave the area as similar well paying jobs do not exist in Central NY anymore. For that reason I would not invest in Oswego unless you got a stellar deal on a house or apartment near the college and target the students as a rental. Just make sure that they are not going to build a large scale dorms anytime soon. SUNY seems to want to spend money lately across the state on new residence halls for students, probably so they can collect the room and board. 

 Thanks Steve, my thoughts exactly.  I don't want to wait forever to get into this so I'm looking in Syracuse area. How are things moving in schenectadynwith the casino coming in?  Helping or hurting property values?

@Tim Griffiths

It's too soon to tell what affect the casino will have, property within the city has remained flat. Personally I don't think much change. Schenectady suffers from a stigma that it will probably never shake. It's widely considered in this area as the worst place to live. Absurdly high taxes and a poorly rated school district means people with the means live in the surrounding towns with lower taxes and some of the best school districts in the state. A casino will not fix that. 

Definitely do not buy property in the city for appreication, in fact plan on keeping that house forever! This summer was very busy around the capital district real estate wise, however I don't know a single person that has successfully sold their house in Schenectady. Some investors do well here by buying cheap and renting to lower income or section 8 but personally I don't want to do that.

@Tim Griffiths

Schenectady is a weird investment twilight zone not for the faint of heart, I live 10 mins from there and am constantly tempted by the decent instant cash flow you can get from the super cheap multi family's there, but @Steve B. is 100% correct in that you'll probably never sell it for a profit, if at all.  

Earlier this summer I nearly bought 2 separate 2 family properties near the casino, they were each priced around $50k, well maintained, fully rented at $650/unit, AND the owner was willing to do 100% seller financing.  Probably anyone on BP would consider those financials a no-brainer, but the guy STILL couldn't manage to sell those properties with those terms and took them off the market a couple months ago.  Regardless of the cash flow you can get in Schenectady, I just can't stomach the lack of liquidity, it feels like putting money into a 401k that you just have to assume is inaccessible for the next 20+ years.  

In Oswego, I'd opt for college areas that are insulated from the layoff, or you're within striking distance of Syracuse and the surrounding suburbs, I'm always all for sticking near home and what you know.  

@Ryan Vienneau and @Steve B., thanks for the tips. Yeah, Schenectady county is more what I was thinking, not the city itself. I saw some stuff in Scotia and Rotterdam that looked interesting. I grew up in Duanesburg so I am very familiar with the cesspool that Schenectady turned into after GE shriveled up. My brother works in Nisky and I've got some contacts out there I trust so that's why I'm thinking it. Oswego is way too fluid, there are incredible looking deals here that are 300 days on market; even advertising in the MLS the great cash flow and cap rate yet no one is touching them.

And Syracuse is not much better.  Carrier left, GM left, New Venture left and the city is barely crawling out of that ten and twenty years later. so, at this point I'm looking at stuff in Syracuse University area, a few suburbs that aren't imploding and just get my first property under my belt.

@Tim Griffiths Welcome to Biggerpockets.

I am a realtor in Syracuse. You can still get good deals that cash flow in Eastwood and some of the pockets of the Northside aren't bad. Eastside is a decent area also. If you are looking at the university area inventory is almost nonexistent, The multi families that come on the market in that area are usually priced around 190K-230K for a 2 family.

The suburbs are always a great option cause the schools are much better. The biggest difference in expenses for properties in the suburbs are the property taxes. Usually higher in the suburbs. Feel free to contact me if you need anything.

Interesting situation. If it was me, I'd wait a year to see the impact of the plant closure. Maybe a better time to buy. Just like stocks - the best time to buy is when everyone else is selling. And the best time to sell is when everyone is buying. This always puts you in the best position.

@Ryan Vienneau Hit the nail on the head! I was tempted myself on a few properties this summer in the city but the lack of liquidity is what ultimately drives me away from purchasing anything within the city limits. Buy and hold should be forever, but life happens and sometimes you need to sell. 

Carrie, thanks for your advice.  Unfortunately, a lot of upstate ny is starting to resemble Detroit/Rust Belt.  Schenectady has been on the downswing since the 1970's and Syracuse since the 90's.  With the plant closure in Oswego, there will be tons of inventory for sure, but tenants could be a big problem.  I'm definitely taking a wait and see in my hometown, but I'm going to continue looking for the right deals, improving my education, tightening our belts at home and growing my network.  I figure if I work hard, within five years I can have a good system in place and can be  growing at a rate that will allow financial freedom.

Just met someone who works for one of the largest builders in town.  It's amazing how when you're aware, how many people you meet who can potentially help you out down the road.

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