Hudson Valley market

44 Replies

Hi all

Does anyone have experience of multifamily buy and hold in the hudson valley area. Say from Beacon/Newburgh up to Saugerties. Would welcome thoughts on capital appreciation, cashflow and prospects for growth in the area

Family has been investing in that specific area for years.  Beacon/newburgh is an intersting case.  Newburgh has typically been a tough place for B&H for multiple reasons.  (tough tenants, tough judges)  Beacon is definitely a hotspot but everyone knows it now so you are going to have to really watch the market to snag a good deal there.  Let me know if you have any specific questions and I'm more than happy to help :)

Agree with Chris.  Beacon popping or popped. Newburgh sketchy, you have to know the area well. Poughkeepsie wants to pop (as does Kingston), but alas, it has no pop. The colleges there make is fairly safe, but it's definately no a flip market.  buy and hold multi-family, but tough neighborhoods.  Saugerties had a pop about six years ago.  It still seems good, but burdened by a lot of ranch, dull, 1950's, not so pretty S.F.'s  Rhinebeck/Woodstock/New Paltz/Stone Ridge/ too expensive, inflated from weekenders - nyc.  I'm looking for a flip now, if you want to discuss.

@Christian Lincoln  I have been looking for a fix and flip in Poughkeepsie for a while now with no real luck. I put in a few offers but nothing solid has come back. I have access to plenty of capital but can't seem to find a good deal. Do you think this is due to heavy competition? Or do people in the area just not buy enough homes to make a fix and flip work? 

Stephen,

Are you getting out bid? I assume not. What has been the outcome of your bids? Any feedback? Poughkeepsie doesn't have grounds for not acceptting fair or even slightly low offers; it's a tough town, though the quality of the housing stock is quite good, there's a lack of jobs, there's a lack of people, there's a lack of morale, there's a lack of money. To me, this is not a flip town. I wouldn't flip there, it's a buy and hold, long-term rental town. Espec. around colleges. There's no upside.  Beacon is different. The city people have arrived. Prices have been rising. I just don't see that happening in Poughkeepsie.  

@Christian Lincoln  

I had an offer in on a property for $40,000 (1608 Violet Ave Hyde Park) but found some structural issues upon a second inspection and had to pull the offer out.   I'm not really a big fan of Hyde Park anyways. Seems like everyone is moving out of that area. The next two I have put offers in on have been outbid. 

I don't have my own personal money to invest, I work for investors that pay me a salary and a % of the profits.  That would be a great situation if I could find deals to make a profit on. They look for a 20-30% return on their money. 

I have not done any marketing to find homes, right now I just use MLS which is part of the problem. A lot of foreclosures don't go low enough for me to make a good profit on. I have looked at beacon but it seems that everyone knows its hot so again a lot of competition to deal with. I know il have competition no matter where I am but some investors don't look for as big of a margin as I do.

Best,

Steve

Have any of you looked at Albany or Troy?  It's a bit further up the river, but still within 3 hours of New York City.  I know a number of people who really like investing in Troy because of the low price points.

I spent a lot of time looking at Albany a number of years ago.  It has a lot going for it, namely, the state capital, which is never going anywhere, as well as SUNY, which is similarly permanent.  It's also a healthcare hub for the surrounding areas.  I don't think that it is ever going to "pop" as some people say, but it is a good buy and hold area because of the stability of the main employers, which you will be able to predict.  A well-located property should stay occupied there.

@Jonathan Twombly - thanks for the advice. I am curious though, what made you decide to stay away from Albany after all your research? Also curious given that you live in Brookyn do you use a property manager?

Hi, very interested in the above discussion. Looking to buy a multifamily fixer-upper in the area, live in it, and eventually rent-it out 100% or sell it, if property values go up after two plus years. Looking at Ossining, Peekskill, Haverstraw, or elsewhere, if I can find a better deal. Any advice on finding properties?

I took a drive through some towns on the west side of the river last weekend (Catskill, Athens, Coxsackie). I liked what I saw, but get the feeling that the high ownership rates in the area/ lack of institutions would mean that buy/hold would be a difficult strategy even at rock-bottom prices. 

Anyone more familiar with these towns? I go by them weekly but have just started to familiarize myself with them. 

@Tim Moran i did a bit of looking around saugerties & albany and a little of Catskill. My impression was that high taxes, plus no real industry meant it would be tough for a buy and hold strategy. There may be better options for flipping but that was not something i was interested in.

I am a buy and hold investor in the Highland Falls to Newburgh areas of the Glorious Hudson Valley.  I won't comment on flips because I don't do them but I have been successful with buy hold.  I will say that I find I am always buying projects where I have to fix them up and the key is to buy low enough and fix cheap enough.  It is as important to understand fair cost of construction as the markets for me.

@Dawn Vacek , do you view the economy in Highland Falls area as being relatively stable?

I see a couple cheap properties on the MLS. 3/1, 1322 sq ft for $114k? Sounds pretty good... what would it rent for? $1800?

Anyone familiar with the Fishkill/Wappingers/Hopewell Junction area? I'm looking for overall appreciation in the market (for my holds) and demand (for my flips).

Appreciation is hard to come by in NY outside of NYC and Westchester

Frank, do you see appreciation improving as more people move further north from the city? I've spoken with a few people in fishkill who made some money in the last couple of years selling as city people have moved up. This is a small sample size of course, but I the area has a lot of potential (I do admit bias though as I love dutchess).

@Dave H.
Did you ever answer that question?

If your convinced one way or the other I'd like to hear.

I personally like Poughkeepsie. It's got a lot of really great housing stock. It also has hospitals, schools etc.

That being said there is a lot of crime up there. I've been looking at Poughkeepsie for about 8 years the houses are really beautiful. Or could be with a bit of work. I've always passed. But lately I noticed a few things that made me more interested.

So I put out a few offers in Poughkeepsie. To low on the first one and am hoping to close soon on another.

I have an apartment building on Main St. in Poughkeepsie.  It's a rough area still.  Lots of drugs and petty crime (and big crime but just don't walk around at night and you're fine).   Main street particularly is bad, a couple blocks away and you can find much safer areas.  There's certainly money to be made on buy/hold rentals though, if you can find one that doesn't need a ton of work up front.  I do believe that as people are coming up from the city, the whole area will begin to appreciate (fishkill, hopewell, poughkeepsie, etc.).  It'll take maybe 10-15 years though, Poughkeepsie itself still has a negative population growth.  I do see the signs in the outlying areas though - East Fishkill is picking up, Hopewell is picking up also.  Lots of land that have previously been vacant or ignored are now being sold with pre-approvals for shopping centers and condos.  We're still a ways off from a growth spurt, but I do believe it'll happen within the next couple of decades.

The HV never really appreciates or drastically depreciates.  The city helps to keep the area constant and unfortunately more people from the city move out of NY entirely instead of heading north. 

Also, we don't have business friendly policies in Cuomos "Progressive Paradise", so we never get the big growth that we should be getting as a benefit from being so close to the biggest city in the country. 

With that said, there are good buy and hold deals to be had because people are always looking to rent and there are decent commuting options to NYC. 

@Aaron K. @Frank Gucciardo

Thanks for the responses!

Points well taken. Aaron I've been on Main St and certain parts are pretty rough.

Could I ask you guys what you think of my deals and misses?

I put an offer on 23 Dubois. It was listed at 48k with Fannie. I offered 29 got turned down and they called for highest and best. I put in another at 33k. I figured the Arv was 125 and repairs around 40k. Taxes 7k. The plan was to rent it out. I was working off of rents of 1100-1200 for a 3/1 and 4/1. Each unit had separate utilities. Recent upgrades to the boiler and HW heaters. It was the second house I looked at in poughkeepsie this time around so I didn't want to overbid and win. But after I lost out I redid the numbers and think my arv was a little low.

Next house is a little closer to Marist. Still
In the city. It's really rough SF 2/1 900sf for 8500. Needs about 40k. I think the arv is 110k rents around 1100. Taxes are 6k. I'm in contract waiting to close.

@John Hickey if your numbers are right it looks like a decent deal to me. Are you going to rent to college kids? My sister went to Marist. Poughkeepsie can be sketchy for sure, but decent rental market.

Also heard there may be a lot of new student housing apts being built which would hurt the surrounding rentals. Something to look into.

Are you going to BRRRR this one?

They are building a lot at Marist but I was so speaking  to the graduate adviser and she says they can't keep up with housing. Even with all they are building that is just covering the international students.  If that is true is it sustainable ?

@John B. I'd like to go after student housing but those numbers were based on regular rentals. My agent does student housing and he said the area I'm in while very close to Marist is not the first choice for students. I was thinking I could put a few upgrades into he Reno and see how it goes. In the post I said 2/1 but I would move things around a bit and turn it it into a 3/2. So if that was the case the rents would look more like 1500-1650.

I'd like to BRRRR it's tough though. I'm buying his with my corp and that means it's a commercial loan on a 100k house. I've looked a bit but found no brokers doing commercial loans for 100k sfr. And I don't blame them!

@Eric Hrlbock

I agree it's a rough area but my first building had a number of shootings out the front door and it's all mustaches and horn rimmed glasses now. Moved my farm to Poughkeepsie for a bit. That's a good heads up on the Marist situation.