Multifamilies is Fitchburg MA

6 Replies | Boston, Massachusetts

I'm looking to start my investing portfolio with a cash flowing multifamily and would like to get as many units as possible with my money. From what I've seen on the MLS, my starting money ($50k) very much limits my search area. I've seen a lot of properties in Fitchburg where the numbers seem to work, but I'm a little nervous to buy there. My main concerns are (1) that the slow economic growth and high unemployment in that area will make it hard to sell in a few years when I want to buy more units with the cash and equity I've earned. (2) I'm worried that it would be hard to fill my properties with quality tenants. Does anybody have experience investing here or in similar neighborhoods and have advice for how to proceed?

Thank you!

I agree with @Ann Bellamy .  The economy in that part of the state is not healthy.

I recently sold a 2 bed, 2 bath home in nearby Gardner for a family member.  Cute house, large lot on a quiet side street, good condition.  It sold for $140,000 and we had a hard time selling it as we had only one offer after multiple open houses and all of our other aggressive marketing.  It was 194 days on market.

Move that house to Brockton and it's $225,000.  Move it to Pembroke and it's $275,000.  Move it to Scituate and it's $350,000.  Those will sell in 30-60 days.  Possibly less.

That said, MFRs in Fitchburg do sell. There were 33 sold in the last 3 months, ranging from $12,500 (REO / disaster) to $250,000.

During that same period, there were 16 units rented, ranging from $500/month to one high-price, 13 room outlier at $2,000/month.  Removing that one outlier, the average rent was $880.

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Look for different ways to acquire property, not just conventional. I have a lot less than that to invest, but I am still looking in the greater Boston area. Find motivated sellers, dilapidated properties, etc. Get creative.

I have rented out the other side of my duplex in Fitchburg for 19 years. It is possible to find good tenants here, but like anything you have to do your homework. Not sure where Charlie got his information about rents, because I have never reported my $1,000 we get in rent for our 2 bedroom to any database that I am aware of. The trick is to have a property that is in good shape and is desirable if you buy the slumloard place those are the people you are left with, if you let someone else manage it for you don't be surprised if they rent to less than desirable people, because yes Fitchburg does have their share of people you do not want to rent to. It can work, the values are less than closer to Boston for a reason, and Gardner is less than Fitchburg for a reason. It is a lower price point to break into the market, but yes there are a lot of multi's here, most are in areas you do not want to be, but not all. You can not rent most of the first people that come along or their problems will become yours. I do not recommend buying a multi in ANY town you are not pretty familiar with or have a friend/partner who can lend that knowledge. And never assume that a local property management company will be that solution for you.

I have two multi families in fitchburg, a 4 and a 3 family that we have owned for over 10 years.  The reason we bought out there was we were young (early 20s) and wanted to invest and it was really the only place we could make money.  Even today, we still are looking in fitchburg because the prices are so low and the rents arent too bad.  you get almost the same rents in Fitchburg as you do in haverhill.  But we are in a good neighborhood.  West fitchburg is a nicer area, stay away from downtown.  you really need to drive around the neighborhoods and even in the good neighborhoods you need to have nice units to get higher rent and better tenants.  You need to do a thorough screening of your tenants.  You can get a lot of return on your investment out there and we have easily been able to ride out the market ups and down.  run your numbers and be realistic.  dont make the numbers work because you like the property or want it to work.  Currently we have 3 bedrooms renting between $850-925 depending on the size/condition.  the multis in the better neighborhoods move quickly right now.  we lost 2 houses we put offers in on.