Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
hey Guys,
Being in Brooklyn, I am always looking out for potential multi family deals close by but out of NYC just because of my budget. A few places I have my eye on are Garfield, Trenton, Yardley, East Stroudsburg, Easton, Allentown, even Mount Vernon. I am wondering where some of you locals began investing if you did out of the city and why? Also how has it been managing something farther away. Looking forward to reading opinions and stories!
Rental Property Investor · New York City, NY · Member since 2017 · 493 posts · 386 votes
8y
Before investing Out of State I looked in our Local Market, after a year of looking and numbers not makings sense I decided to look elsewhere.
I decided as a beginner Im better off investing in a Landlord Friendly State, I landed in NC. The markets I'm in are now very competitive but I am becoming creative with my offers to have an edge.
As with everything there are Pros & Cons, in the beginning expect to travel more than you might like but once you have a system and a team in place its smooth sailing. I now only travel, to find new Markets, make new acquisitions or meet new team members.
Before looking outside NY state I considered Upstate NY but I decided I prefer flying 2.5 hours to avoid the snow than driving 2 hours into the Snow... There are many investors in NYC that invest in Upstate because prices are much better than in our market, it wasn't for me.
Biggest plus I believe of investing OOS is if you succeed you will have the confidence to branch out to any Market. I recently decided to diversified & I'm now in Contract in a new market..
If you are considering investing OOS read @David Greene Long-Distance Real Estate Investing book, I heard the audio book on my recent trip. Even though I have a little experience I found it helpful to know I'm already practicing what David is preaching and book gave me a couple of new ideas, I recommend reading it..
Rental Property Investor · New York City, NY · Member since 2017 · 493 posts · 386 votes
8y
Before investing Out of State I looked in our Local Market, after a year of looking and numbers not makings sense I decided to look elsewhere.
I decided as a beginner Im better off investing in a Landlord Friendly State, I landed in NC. The markets I'm in are now very competitive but I am becoming creative with my offers to have an edge.
As with everything there are Pros & Cons, in the beginning expect to travel more than you might like but once you have a system and a team in place its smooth sailing. I now only travel, to find new Markets, make new acquisitions or meet new team members.
Before looking outside NY state I considered Upstate NY but I decided I prefer flying 2.5 hours to avoid the snow than driving 2 hours into the Snow... There are many investors in NYC that invest in Upstate because prices are much better than in our market, it wasn't for me.
Biggest plus I believe of investing OOS is if you succeed you will have the confidence to branch out to any Market. I recently decided to diversified & I'm now in Contract in a new market..
If you are considering investing OOS read @David Greene Long-Distance Real Estate Investing book, I heard the audio book on my recent trip. Even though I have a little experience I found it helpful to know I'm already practicing what David is preaching and book gave me a couple of new ideas, I recommend reading it..
Valley Cottage, NY · Member since 2017 · 84 posts · 28 votes
8y
I invest in Philly. Because it’s the 5th largest population and still affordable. (For now)
The RiverWard section is growing and fast and I can even use an AirBnb model with no problems to generate even higher returns.
I have a team there and my senior partner who still lives in NY has been investing there since 1999.
Wholesaler · Newark, DE · Member since 2015 · 303 posts · 80 votes
8y
I always wondered how investors from NY invested in real estate. I always said if I could pick up a MFH property in Brooklyn or the Bronx I would be successful.
As for Manhattan, I’m not even going to set my sight that high...yet! :)
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
hey @Raul R. that is a very good point regarding southern properties and definitely the weather. I actually have the book on audiobooks and started listening to the first parts a few days ago. Mind me asking your first deal OS?
Hey @Evan Torrens Philadelphia is a city close enough that is interesting, I have not been down there a lot except to look at tax sale properties which were obviously in mostly undesirable neighborhoods. Coming from a construction backround, I was somehow molded into buying cheaper and remodeling but I am trying to get into the more smaller upgrades on properties to being up value instead of dumping 50-60k to renovate.
We do flip properties in and around East Stroudsburg. We have 3 single family rentals in that area as well. I'm looking into Philly now, was actually out there yesterday, because we're looking to do more units. We're looking at 3 to 4 families in Philadelphia for now. We're possibly looking to do something larger after we get our feet wet.
Rental Property Investor · East Meadow New york · Member since 2014 · 232 posts · 95 votes
8y
@Milan Obradovic
Im a buy and hold investor and primarily focus on the Stroudsburg market of PA. We purchase value add multi families, do a full rehab and rent long term. Although there is not much inventory the deals we land do produce a good amount of cash after debt. Good Luck!
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
@Ceasar Rosas That is awesome. East Stroudsburg is an area I am more familiar with. I have been there many times, do they have a law like Wilkes Barre if you reside 20 miles outside of the city that you MUST have a property manager? Philadelphia is even a little closer from me, about and 1:15min drive.
@John Geldert Thank you for the insight! I am almost certain you get off market deals when they come up because anything located on Zillow, Trulia, etc is overpriced ATM.
Jersey City, NJ · Member since 2016 · 61 posts · 44 votes
8y
I invest in Allentown due to strong returns and favorable landlord laws. The tenants might not be the best, but the returns, appreciation, and proximity to NYC were the deciding factors for me. Where else can you find an area where every porperty on the MLS meets the 1% rule.
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
@Raymond Y. mind me asking what do you consider favorable landlord laws? Quick evictions? Do you mostly do a lot of upgrades or look for something that has been fixed up? Thanks!
Jersey City, NJ · Member since 2016 · 61 posts · 44 votes
8y
@Milan Obradovic Favorable landlord laws meaning I am able to kick tenants out in a month if they don't pay rent. So far, I've only been under contract for two properties in my REI career. One needed cosmetic updates and one needed pretty much a full rehab. As long as the numbers worked, I wasn't worried to tackle on a big rehab project.
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
@Raymond Y.
That is a heck of a lot better than NYC. Especially if the tenants have children. Have you done Brrr in Allentown on those two deals or just down payment and rent?
Jersey City, NJ · Member since 2016 · 61 posts · 44 votes
8y
@Milan Obradovic I am trying to do BRRRR right now on my first property. I won't be able to pull all of my money out, but I should be able to pull enough out to buy another property. This deal was a little more turnkey, so I wasn't able to force as much appreciation. How did you get interested in Allentown?
I have been investing out of state for over 10 years now. The best advice I can give you is have a good system in place and a good team in whatever area you are investing in. I also recommend working or talking to someone who has invested out of state successfully BEFORE dipping in on your own. It doesn't hurt to mitigate your risk as much as possible by learning from others first before putting your money out there.
I wish you lots of luck on your first BRRR. From what I understand That strategy is most efficient when it comes to adding SF to a property. An extension, a floor, extra bathroom etc. Those seem few and far between for starting out in these areas unless you have extra cash on hand. My interest in PA generally started through tax sales. I began investing in those properties and was able to aquire 3 within the last year and a half, Bucks & Luzerne county. I am in contract to sell two so my goal is to use the money into a smaller scale BRRR. Allentown was one city that I looked at tax sale properties. It's size was appealing as well as its smaller entry point, even though I went to their tax sale with 10-15k to spend and realized 20-30k was about the cheapest houses were going for.
@Steve Kontos Thank you for your feedback, the whole team is an ideal way to go. Where out of state have you invested? I am in the process of going to REI meetings and connecting with people. It is tougher than it seems just because I feel my current value to provide is not on par, have not met someone who is willing to take me under their wing. Reading posts, stories, books, and listening to podcasts are all inspiring. But definitely can not take the place of real world experience.
New York, NY · Member since 2018 · 14 posts · 7 votes
8y
Im in a similar scenario as you Milan. Live in queens. Attempted to do MF here but just nothing that makes sense. Looking to attend a couple of REIA locally too. Maybe ill catch you there..
In meantime Ive been slowly growing contacts in Nashville. Also looking into Raleigh.
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
@Matthew Iulo Hey, your areas of interest are definitely not a drive away. What has been holding you back, knowledge or finances so far? My mindset is to have money on hand for an investment then start reaching out to agents and start building a relationship. I do not feel fear in buying something, I am more into learning to analyze different markets and either buy one BRRR or one with a smaller down payment to cash flow but make sure I have enough cash to support both types of deals, since almost all investments need money for some type of upgrades. Btw I am attending the SJREIA in Cherry Hill, NJ 3/26.
Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
8y
There are a ton of NYC investors that come to Philadelphia. We see them and work with them every day. It's the largest cross city investment relationship in the country from what I was told.
Brooklyn, NY · Member since 2016 · 49 posts · 12 votes
8y
Hey @Ben Sosa . Do you flip or do buy and holds in Newark? It seems like a market that is more ideal for Buy and Hold than Flipping but I wanted to get your insight on it. I was thinking of doing flips but I am hesitant since I feel that there isn't a large buyer pool. What do you think?
Real Estate Agent · Brooklyn, NY · Member since 2017 · 88 posts · 14 votes
8y
@Raymond Y. The tax sales that I began my interest in are Judicial Sales in PA. They happen a few times per year in each county. The dates and lists are uploaded on the county websites. These lists change, but my process has been 2 weeks before the sales to go over the properties, identify a few that interest me, drive them a few days before the sale and lookup and records of mortgages and liens. If they are not taken off during the sale, you can bid on them, then you must cash them out by the end of the day. Most properties are in bad shape and require rehab of some sort, most are vacant land, but there is always a property that can bing back value either through fix and rent or clear title and sell or refinance. I have a great attorney in Luzerne county for quieting titles that I am working with now on one.
Real Estate Agent · Jacksonville, FL · Member since 2015 · 1k+ posts · 1k+ votes
8y
A good friend of mine bought a duplex in Park Slope Brooklyn in the early 90s. The appreciation is just short of scary and if he or I would have had any idea....
In the current market the gateway cities are out of touch for most investors. At this moment they offer scale and low returns. Foreign money and institutional money dominate.
I recommend looking at second or even third tier cities. The tri-state area is tough while not part of the tri-state area, much of PA can be lumped in. These area may technically be cities, but they are really suburbs of larger cities. Scary to think Allentown is a NYC suburb, the number of people making that commute is amazing. The taxes and landlord laws add a level of challenge to building a portfolio.
I am a big fan of investing in the south. The laws are more landlord friendly and the taxes are lower. there are also a large number of second and third tier cities that less competitive and as a result more profitable. The population and jobs are moving south. For example, many of the Financial services companies are relocating their back office into the south. Originally they moved out NY of to NJ or Conn, now they are moving to NC, Fl, Ga.