Holyoke, MA: Current state of the market

1 Reply

Good Evening,

Comments/concerns/questions always appreciated;

Over the past few months I've been paying close attention to the Holyoke, MA market. Noticing a consistent rise in Holyoke multi-family property values, I thought it would be beneficial to ask if others share the same like-minded opinion?

After diving deeper into the forces driving the current state of the market, I continue to ask myself the following questions;  

-What is propelling this surge in value?

-Are rents justifying the increase or is there a variable factor playing a significant role that I have yet to distinguish?

-Are investors more heavily weighing the appreciation benefit over cash flow?

I've seen 2's and 3's go under deposit in a matter of days. That is; 2's and 3's listed for north of 250K. Are these multi's going under because Holyoke is becoming a more desirable "owner occupied" city. Or are investors settling for a "nicer" location with decent rents and quality tenants rather than a purely cash-flow vantage point.

Even if the Holyoke market is seeing rents in the $1200-1300/month range; is this a worthwhile justification to paying a premium on these smaller multi-families?

I often ask if paying $100-125K+, for a turn-key unit, is a more financially effective play compared to buying a rehab/remodel project at discount. I understand a rehab/remodel project carries a far greater risk, but aren't your returns going to be much more enticing?

Thoughts, insights, or comments about anything regarding the Holyoke, MA market are much appreciated. Generally speaking, it is always nice to see the area receive the recognition it truly deserves. As I do whole-heartedly believe the potential and opportunity in this area are fantastic.

Kindly,

Ryan J

Ryan, Just finding this now. I am a new investor in the Western MA area and am looking at multiple areas including Holyoke for a residential multifam to house hack as an initial investment property and keep as a rental down the road. I have done a lot of research and a lot of reading/educating about REI in order to be prepared but am at the point of needing to learn the rest by doing.

From what I have learned, Holyoke is an interesting location that has some blemishes for sure. I have heard there is a great sense of pride in Holyoke if you can find a good location. However, there is a general stigma of it being a trash pit. I personally have narrowed down my acceptable area to about 1/3 of the area of Holyoke. Everywhere outside of that I cant justify the risk of crime, low-quality tenants ect... Even in this third the schools are very low quality, but the crime is pretty low compared to the downtown area. 

I am even weary about the 1/3 that I am looking at due to not knowing the exact tenant population/demographic in terms of quality and occupation as well as the schools not being good. 

The last thing I need is for my first deal to be a big loss. 

If you ever want to reach out and have any more conversations about the area and share experiences I would love to connect. 

Kind Regards,

RT