I'm looking to invest in the Worcester area in the multi-family Rentals and rehab, Is anyone currently involved in Worcester county? Looking for some feedback and advice on this market. Does anyone know a good real estate agent out that way?
Hi Jose. PMing...
Hi Jose! I have been an investor since 2016. I own multiple investment properties and helped investors get started on their investment journey. I’ll send a connection request to you.
Jose, look for Brian J Allen here on BiggerPockets. He sees every multifamily property that comes on the market in the Worcester area. He's been in 1500+ over the past year alone. Multifamilies in Worcester are truly his specialty, and he has an ear on many off-market deals that are not on the MLS. He will teach you everything you need to know when purchasing in the Worcester market. He is a wonderful source of information, and I highly recommend him. He is perhaps the most valuable member of my team.
I'm an investor in the Worcester County area starting in 2019. I currently acquired a triplex in Millbury last December and I'm always looking for more properties to add to my portfolio and increasing my network. I'd like to hear about your business model in the Worcester area and how you've adapted throughout the pandemic
I'll definitely try to connect with Brian, he sounds like a great agent. How has he assisted you in your investing in Worcester? Would like to hear about your experience in the area.
@Daniel Lopez congratulations to you on your first acquisition. You have already taken the first step to building wealth and legacy. Originally, due to the pandemic I speculated for the market for single families to slow down but clearly that wasn’t accurate lol. So I was focusing more on small multi families to rehab and refi into a 30 year mortgage. Small time landlords who were ‘managing’ their own properties and did not have reserves to stay afloat during this time and kept putting off all the maintanence items over the years just wanted to get rid of their properties. 6 of my 8 units acquired in the past 6 months were tired landlords and the remaining 2 units were from a friend who owned a property for over a year and did not have time to fix it. So I ended up buying from him. I am also figuring out a way to work with local housing authorities to place their clients in my apartments because they cover 70% of the rent portion. This way you are covered for majority of your monthly expenses. Don’t stop looking and acquiring just because market is too hot. You will always find deals. I’ll send you a connection request.
That’s a great strategy Syed. I’ve heard of finding local small time landlords and seeing if their interesting in selling before. I’ve always wanted to try it, just been focused on my properties. Do you look at Craigslist or Facebook Marketplace for current landlords? I’ve gotten some great leads from there. Just look at their rent ads and call them asking about their interest in selling that property or any other property.
I’d love to hear more about your work with the Local Housing Authority. Is this to have Section 8 tenants in your property? Do you have to be in a particular zip code or neighborhood to work with the LHA? I’ve been looking at rehab grants to fix up some multi family properties, but they require renting to the units to Section 8 tenants for around 70-80% market rent depending on the average income in the area. I wonder if that is for the portion that the tenant pays or the entire rent. If you have any connections in the Local Housing Authority, I’d be interested in speaking with them on some opportunities.
There are lots of ways to find things. But in Worcester the key is knowing where you are buying. Rents change street by street so you really have to be careful.Also, certain areas houses appraise and others don't. eg. A SF in a Multifamily neighborhood likely is worth more than the bank thinks, same for a MF in SF neighborhood as the comps aren't there.
@Joseph Belgrad Thank you, A lot of great info. and @Brian J Allen I'll definitely try to connect with you. Thanks, everyone.
Hi @Jose Betancourt Worcester is a great market we are doing a few project for ourselves and for clients in the area and are actually looking at standing up our own Property Management Company in that area to manage our rentals and some of our clients. To Brian's point Worcester changes by the street so focus in on what you're looking for in the investment property and then try to narrow down your search.
Are you buying this as a typical investment property or are you planning to househack/owner occupy it? I have 3 agents that work for me in Worcester. One of my requirements for agents that join my team is that they need to own investment properties or plan to invest within 1 year. I'm a big believer in "Eat What You Preach". If you're going to help others buy investment properties you better buy some yourself. Anyways 1 of my agents is househacking a "turnkey" 3 family with the intention of living for free. Another one 1 is midway through a 203k rehab project on a 4plex that will turn into a BRRRR. 3rd is in the process of looking for a househack but after much deliberation realized that lifestyle is better than cashflow and wants to be outside of Worcester. She's now looking in Clinton, Millbury, Grafton, and other surrounding towns and doesn't mind kicking in a few hundred $ a month to live in a property that works for her. All of them are in different parts of the city, or outside the city, which is fine because they each have different goals and strategies.
What is your strategy and what are your goals? You mention wanting to do a rehab, is that an extensive rehab or just kitchen, bathroom, floors? Are you looking for aSingle Family, 2 family, 3-4 unit, or 5+? All of these will help you figure out where in the city you want to be or maybe outside the city if it is a single family or 2 family. The ARV is higher in surrounding towns than Worcester proper which makes your $ go further if you're planning to do a flip.
Also. we also host a virtual meetup each month. we were doing 3 in-person meetups each month pre-covid, but the next virtual one is 11/19 if you're interested in attending. It's a great place to share information and you could connect with other local investors. If interested just PM me and I'll send you the link. It is posted here in BiggerPockets events under "Pints & Properties" but the search option isn't the best.
Best of luck and let me know if you have any questions or need anything.
@Brian J Allen
How would you go about getting an accurate appraisal of a SF in a MF neighborhood (and vice versa)? I feel like the bank would be hesitant on agreeing on a high appraisal if there aren't any comps to justify it. Would you have to evaluate the property as a rental property and calculating it's value based off the rents you can get?
Unfortunately I had one where it was a SF in a multi neighborhood by a college, and the projected rents justified the price. But the bank went on ONLY COMPARABLE SALES and we were too far off. Place was a great house hack/investment, but we couldn't make up the difference. The key to getting the good appraisal in the SF in a Multi neighborhood is to have a local bank/appraiser. If you are doing a multi in a multi neighborhood, often it helps to have an out of town bank and appraiser as the guys from Boston think Worcester 3 deckers are undervalued.
@Jose Betancourt Danny Diroberto, Diroberto Real Estate/Property Management. Hes born and raised in Worc and knows the market really well.
If you are considering doing a flip/rehab check out the lead laws for Worc and MA which are stricter than CT. Also Worc multis tend to still have knob and tube electrical, horse hair walls and lead plumbing. Ask about those things before buying to figure into your analysis. The city has grants for rehabing 3 families but require you to rent to low income/ below market rates. Last time I looked into utilizing the program it didnt make sense from a numbers POV.