First time homebuyer looking to Live/rent duplex in East Boston

9 Replies

Hello everyone - voraciously learning about real estate as I explore my first potential purchase. I own my own business so that has helped a lot with the financial analysis side, but I know I still have TONS to learn. I'm looking forward to getting involved in the bigger pockets community! I'd love to hear from others who know the East Boston market well. 

Andrew K, what exactly did you want to know about the East Boston Market? I have lived in East Boston for about 8 years and own several condos, all in East Boston. I would love to answer any questions you may have, just let me know exactly what you wanted to find out about the market. 

Hi @Andrew K. and welcome to BP. I live in Chelsea and this week my wife and I were in East Boston yesterday and stopped into an open house we were driving by just out of curiosity. It was a Multi family 2 bedroom/1 bath on the first floor and 3 beds/1 bath upstairs. The units were rented at $1800 downstairs and $2000 upstairs. The reason it would be an awful investment is that they had an asking price of $610k(I know sometimes you can negotiate way lower than the asking price, but it's not very common in that area). I strongly recommend finding a property that you can get at least 1% the purchase price in monthly gross rent, which is likely not attainable in that area. At the market prices there you basically can't cash flow and it would be a safe bet that values will have to come down at some point, I believe that will happen soon. You can find much better investments out in the north shore(especially Lynn) and in the Lowell area. Is there any specific reason you were thinking about East Boston? Just an FYI, I believe the reason the prices are so over inflated in East Boston is because of the profits investors are turning by turning these 2 and 3 families in east Boston into condos, which allows them to pay ridiculous prices and still turn a profit.

Hi Andrew. Along with being a resident of East Boston a few years back, I do a lot of work as an agent buying and selling in east Boston. Please feel free to reach out to me at any time! I'd love to show you some current properties based off of your needs and wants... Better get in there soon though, it's on the up and up!

@andrewk

Hey andrew, just finished a condo conversion in eastie and have a rental three family myself. Are you available to meet over coffee over in eastie?

I do agree that the number do not work for a 2 family at 600k. Obviously it shouldn't take much to realize that. But a three family for $500-$600k when 3 bedrooms are being leased for $2100-$2400 can work just fine as either fully rented or living in one and leasing the other two. I suppose I have always viewed anything I bought as a long term investment and looking at the history of the market in Charlestown, South Boston, and Somerville I personally am confident that Eastie will command the same home sale purchase prices in another 5-10 years as the other markets do now. And besides I have lived in Eastie for the past 7-8 years and like the convenience of living so close to the city. The parks are beautiful, and the neighborhood is changing at a rapid pace.

Yeah pretty much anything on mls in and right around boston is usually not a deal. Have to go off market. That said, you can still make Boston and surrounding hot areas work. Outside the city the cash flow and purchase prices are better. In the city vacancy rate much lower (next to nothing if you know what you're doing), general appreciation, and holding value in a down market better. I do notice the investors I know that are killing it in the hot areas are not on BP

To add to the talk. The 1% rule is not realistic for Eastie right now (maybe 5-10 yrs ago). You are buying upside, appreciation and a rapidly maturing location. That said it is still a relative deal. 5 years ago I thought $250k + per unit in Somerville was nuts. Now? Forget it. I think something similar is happening here in Eastie.

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