New to RE Investing from Quincy, MA

14 Replies

Hey everyone my name is Justin. I'm from Quincy, MA.  First, I just want to say that I have enjoyed reading the site over the past week, it's been a great learning experience. My background in real estate is fairly limited. I joined a real estate law firm in July of 2015 and have been working there ever since. So, while i'm well versed in closings, purchase and sale negotiation/drafting and title work i'm not nearly as well educated in what underlying numbers make a deal work from an investment perspective. Although I have since learned a bit about the 2% rule and 50% rule.  

In terms of goals, I don't think that I want to have a big portfolio (although this may change the more I learn). What I always envisioned was turning my current condo into a rental after living there for about 5-8 years (it's in a nice location about a five minute walk to the red line, for those non Bostonians that's one of the train lines that takes you into Boston). When that unit gets paid off I would then buy another and so on and so on. My underlying logic behind this is that I don't want to over extend myself. By adding one unit at a time where my salary can cover the rental mortgage and my personal mortgage I view it as a less risky play. 

Although, I have a feeling that it may be the exact opposite, by keeping only one unit there is far greater risk because you could have a situation where your rental portfolio is 100% unoccupied/or worse you're stuck with a bad tenant. This is a very different model from what appears to be the norm of adding lots of units quickly/rehab/cash out refi, etc. so any comments on why my strategy would be a bad long term strategy would of course be much appreciated.  Thanks and glad to be a part of the community! 

Hi Justin,

To me less leverage always means less risk.  Having enough income from your job to cover all of your mortgages would help me sleep better at night.  If you seek diversity in terms of # of leases in place you may want to consider a Multi.  I'm interested to hear what others have to say.

Good Luck!

Jason

Welcome to BiggerPockets Justin! It's nice to see someone else from Quincy. I am just getting started as well so I don't have much input to your question, but in terms of your goals, like you said, they can change and just be open to that idea.

How did you get into working for the real estate law firm? Did you need any sort of background or education? I'm currently looking for a career change and a job in real estate is definitely ideal.

Welcome Justin,

I'm not an expert investor since I just started with my first property several months ago, but I do have a background in the Boston real estate scene with a specialization in rentals and (for a couple of years) property management.

For what it's worth, I think your plan is sound provided the rental income in consideration of local vacancy rates, property maintenance, etc.. nets you positive cash, or at least allows you to break-even after expenses are paid. For obvious reasons your plan isn't a get-rich-quick sort of plan, however it's much less risky and, if done right, will secure you a near worry-free retirement after you own everything free and clear. I know a bunch of landlords who have done it the way you're planning, and they're all living comfortable lives in their retirement. I like to think of it as a more flexible and more profitable version of an IRA.

My recommendation is that you consider looking into multi-family properties in particular areas of Boston/Brookline such as neighborhoods near major colleges (Northeastern, MCPHS, Boston University, etc..) as the vacancy rates there are ridiculously low (0% if your unit is priced right). For burgeoning neighborhoods, consider Roxbury (Fort Hill in particular), and East Boston. It's also imperative that your property be near a T-line.

One multi-family in these areas (with the exception of MAYBE Roxbury and East Boston CURRENTLY) would net you greater rental income than several condos in the Quincy area, provided you find the right property at the right price of course.

@Patrick Wheeler :

How did you get into working for the real estate law firm? Did you need any sort of background or education? I'm currently looking for a career change and a job in real estate is definitely ideal.

Hey Patrick, well i'm actually a real estate attorney. So, 3 years of law school and the bar exam lol. Wouldn't recommend it for someone looking for a quick career change! Thanks for the reply and welcome to the site. 

Originally posted by @Reed Sasamura :

Thanks for the great advice Reed. That's the end goal, a near worry-free retirement. Any idea how many properties those landlords own? I suppose the quantity does not matter nearly as much as the cash flow each gives off.  

Originally posted by @Jason Carter :

Hi Justin,

To me less leverage always means less risk.  Having enough income from your job to cover all of your mortgages would help me sleep better at night.  If you seek diversity in terms of # of leases in place you may want to consider a Multi.  I'm interested to hear what others have to say.

Good Luck!

Jason

Thanks Jason. I am definitely interested in a multi for the next place, it would be nice to have someone help out with paying the Mortgage. 

Welcome Justin to the BP community!

It's really nice to see people from Quincy, MA joining BP.
I'm relatively new to this too, I'm currently in the phase of trying to build a core team, of contractors, handyman and investors e.t.c

There is a lot to be gain from BP, apart from the wealth of very relevant information, there is also the relational aspect of it. All it comes down to is how you choose to utilize the site and the tools made available to you.

I'm also from Quincy MA, own 2 properties there, and one multi-family in Dorchester MA.

The gentle man, "Reed Sasamura", though his profile says from "Honolulu Hawaii". His brief analysis of the Boston area Realestate market is right on the money!  I wonder if he use to live in MA?

Anyway, I'll love to meet if you're interested, and would like to also extend the invitation to Patrick Wheeler, since he's also from the same neighborhood (Quincy MA). Let me know if you guys are up to meeting over tea/coffee.

I wish you the very best in your Realestate endeavor. 

@Justin Snyder

Welcome!  You are leagues ahead of many of us with that knowledge base under you and your experiences.  All the best with your plans and outcomes in the year ahead.

@Jerry Agbon , I lived in Boston for 7 years. About half of that was spent specializing in a particular area of real estate as an agent and eventually a manager in a large local brokerage. I'm definitely not a "seasoned expert" as I'm sure there are others who know more than I, but I hope my limited input is able to help others.

@Justin Snyder, the majority of the landlords I worked with owned somewhere between 2-4 multi-families. Some focused on particular neighborhoods, and others bought places all over the place. The average income per property varied so much that it wouldn't be fair for me to place a single average income figure per property, but if I HAD to, I'd say each property brought in (on average) around $4000 to $5000 gross rent roll. Thus by this estimate alone, and at minimum, in your retirement you'd be making $96K a year, minus any property expenses, in addition to social security (assuming it's still around), and any pension, IRA, or 401K. Not bad I'd say.

@Account Closed Welcome to BP. Theres lots of good advice above. especially about going for multi family buy and hold investments. I highly recommend the book the millionaire real estate investor by Gary Keller, it may help clear up some of the nuances of real estate investing. After reading it you may be able to have a clearer picture of what you may want your goals to be. I always liked the more aggressive buy every property you can with as many units as possible approach, so long as all properties are bought well and cash flow to your standards from day 1. I also recommend going to the local REIA meetups like black diamond www.BlackDiamondREI.com as you can meet other investors there and they usually have a speaker thats an expert in their own niche, which could be very helpful for someone starting out. I do caution you to be careful with some of the other meetups as some of them are just trying to pitch Guru services.

Hi, Justin, welcome to BP.  

You already have a leg up being an attorney.  One suggestion on the landlord front:  You already know how to read the law, so don't need us for that.  But finding out how MA housing court judges apply it could be eye opening.  Either spend a little time in Housing Court, or connect with another really experienced MA landlord attorney to get the scoop.  It will be eye opening, if you haven't already done so.  

Personally, I like multis if you plan to hold indefinitely.  It's hard to have 100% vacancy with a 3 or 4 unit, and you don't have 3 roofs.  

You'll meet a lot of local investors, some MA attorneys, and some of the Bigger Pockets people at our Black Diamond, hope to see you on the 19th.  And thanks, @Mike Duran for the kind works.

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