New to Real Estate · Mystic, CT · Member since 2016 · 16 posts · 4 votes
I ended up taking a drive to New London today to take a look at a couple properties that had some cash flow potential. The properties themselves didn't look terrible, but it was the surrounding houses that had me nervous. Most of the surrounding properties were dilapidated, boarded up, or straight collapsing in on themselves. I also didn't get the safest vibe from the area. All in all, I had a bad gut reaction.
I am likely going to be financing one of these MFH with an FHA loan which will require that I take occupancy immediately and for a year. Safety concerns with that plan aside, I am also concerned with potential issues with tenants (turnover, late payments, damaging property, etc.). As the surrounding area does not lend itself to attracting stable tenants, I am thinking purchasing one of these properties may not be as great as they look on paper.
That being said, I was in the area for all of three minutes before I drove home, so it was an initial impression. I'm prequalified for 180k at the moment, so my fear is that if I want to house hack MFHs in the area, this might be the only viable option.
Has anybody had experience with a Buy and Hold strategy for MFH properties in New London? Are my fears unfounded?
Hey Sean. I have two multi families in New London. There are parts of New London I would not invest in, but people do invest there. You could give the areas another shot. Walk around at night, talk to some neighbors and see what you think. If you don't want to live there, no problem with that. Make sure you are comfortable with where you are going to live.
I wouldn't rush to buy something; there will always be more deals.
On another note, we have a small meetup of investors from New London County. We have been meeting via ZOOM once a month. Let me know if you want to join.
Providence, RI · Member since 2019 · 37 posts · 35 votes
6y
Hey @Sean McFadden. I don't have much experience with the New London market but I'm currently househacking a 3-unit in Middletown, CT, so not far away! I would highly recommend looking elsewhere for your first property if the area is as bad as it sounds. If you are serious about getting into real estate investing for the long haul, your first deal doesn't have to be a home run. Use your first property as a way of getting into investing and developing the systems you will need to be a successful landlord. Bad properties/areas bring bad tenants, which is a bad recipe for a new landlord and may affect whether you want to stay in investing down the road. Using a low down payment FHA loan gives you a great benefit over ordinary investors in both the down payment and to some extent the rate, meaning you can experience greater ROI on the same property over someone who put 20% down. You may have to look outside New London, but look for a property in an area you don't mind living and think outside the box about how you can add value. Let me know if you have any other questions or want someone to go over numbers, I'd be happy to connect!
Hey Sean. I have two multi families in New London. There are parts of New London I would not invest in, but people do invest there. You could give the areas another shot. Walk around at night, talk to some neighbors and see what you think. If you don't want to live there, no problem with that. Make sure you are comfortable with where you are going to live.
I wouldn't rush to buy something; there will always be more deals.
On another note, we have a small meetup of investors from New London County. We have been meeting via ZOOM once a month. Let me know if you want to join.
New to Real Estate · Mystic, CT · Member since 2016 · 16 posts · 4 votes
6y
@Ryan Twombly, I just connected with you! I am in the early stages of a deal analysis for a property that doesn't have huge potential cash flow, but may be a great starter home to house hack. If I get deeper into it, I will reach out for some feedback on the numbers. I appreciate the offer!