I was curious, for those of you investing in MA. Are you having success with Multi Families? It's an expensive market so I was looking on some feedback whether you're having success or investing long distance etc. Also when you look at your cash flow, do you look at it from door to door or as the entire unit? This question more so pertains to smaller multi families. As always thank you for your feed back!
@Shayne Mahoney I don't do a lot of rentals, but as a MA Realtor (and as a landlord) it is highly illegal to discriminate against a potential renter because they receive any form of public assistance.
If you look at the crime heat maps on Trulia (about the only thing it's good for), you can get the lay of the land. From what I've seen, New Bedford has somewhat less crime than Fall River, so I'd look there.
I recently drove through the waterfront and was really impressed by what they've done with it. It's beginning to look like a new Charlestown in the making!
Brockton is divided into two zip codes. 02302 is the center and east. This is what people call the "war zone" - especially the center. 02301 is mainly the west side and is a really decent place. Comparing the two, center/east is characterized by homes in disrepair, overgrown yards, etc.
If I were to drop you blindfolded into 02301 and tell you that you were in Canton, you would be impressed at how nice Canton is.
I feel your pain regarding the Braintree split. However, Brockton and most of the south shore has excellent commuter rail service. Look at www.MBTA.com and there's a function where you put your starting point and destination in and it will give you commuting options.
It is a question of what part of MA you are looking in. If you are talking about multi families in Boston, then you are talking about the most hyper competitive where the properties coming on the market will have a small cap rate and need to be closely speculated, also the market in Boston is closing quickly and is a good/great deal is becoming harder and harder to come by but not impossible. If you are talking about the secondary markets while opportunities exist it is entirely a question of opportunity and what your individual level of confidence is the deal. Rents right now are leveling off right now but still in high demand, but it is still a question of the quality of the deal.
@Matthew Perry Thank you for the input. Ideally, I'd like to invest in the North Shore. Everett, Melrose, Winthrop, etc. I've yet to actually start investing, so I'm saving and trying to accumulate as much knowledge as I can. I will probably have to house hack for my first investment property. But like you said, These markets seem to be getting more and more competitive.
@Shayne Mahoney The south shore has some of the best areas in eastern MA. Plymouth, Brockton and Middleboro are good targets. A little further south, Taunton, Fall River and New Bedford are even less expensive.
@Charlie MacPherson Thank you. Seeing as my first investment will probably be a house hack, I think I’m going to stay away from the south shore and the Braintree split for this one lol. I’m glad to hear the numbers are working for you there too. Now I know Brockton and Fall River can be grittier areas. Do you do low income or section 8?
@Shayne Mahoney I don't do a lot of rentals, but as a MA Realtor (and as a landlord) it is highly illegal to discriminate against a potential renter because they receive any form of public assistance.
If you look at the crime heat maps on Trulia (about the only thing it's good for), you can get the lay of the land. From what I've seen, New Bedford has somewhat less crime than Fall River, so I'd look there.
I recently drove through the waterfront and was really impressed by what they've done with it. It's beginning to look like a new Charlestown in the making!
Brockton is divided into two zip codes. 02302 is the center and east. This is what people call the "war zone" - especially the center. 02301 is mainly the west side and is a really decent place. Comparing the two, center/east is characterized by homes in disrepair, overgrown yards, etc.
If I were to drop you blindfolded into 02301 and tell you that you were in Canton, you would be impressed at how nice Canton is.
I feel your pain regarding the Braintree split. However, Brockton and most of the south shore has excellent commuter rail service. Look at www.MBTA.com and there's a function where you put your starting point and destination in and it will give you commuting options.
@Charlie MacPherson Great response. A lot of good information there, thank you. I guess I need to keep an open mind to areas with reputations and just connect with people who are more familiar with the area like yourself. I never would have guessed. And I mispoke about the section 8 question, I more so meant do you see it more frequently? I know you can’t discriminate against anyone for anything really. But you are allowed to pick a better prospective tenant correct? I could be wrong so please correct me if so.
In other words, you cannot pick the green client over the purple client because you don't like purple people. You need to have an OBJECTIVE reason for your decisions and it had better be applied equally to all prospective tenants.
Believe it or not, the state employs people who are "testers". Their job is to try to trick you into saying or doing something that they can claim is discriminatory - and although this is the textbook definition of entrapment, the MA courts have held that you cannot use entrapment as a defense.
I was talking with another agent a couple of days ago. She had what she's sure were testers go with her to see a house and at one point asked her point blank if the area was white.
Like a toddler at a urinal, you need to be on your toes.
@Shayne Mahoney Boston area is an expensive market but you have to put that in perspective. Yes, a 2 or 3 fam can run you $700K or up depending on the area, but you are also getting gross building incomes of $5000 or higher. You're obviously not going to cash flow around here compared to other areas in Mass, whether its west (Worcester) or south (south shore etc). The question on whether to invest here really becomes do you believe in the Boston market for the long term (you're investing in local economies just as much as you are in concrete!). So, if you think that Boston has more room to grow economically, then investing here is a good bet. I look at the business news all the time to see which companies are coming here, who is thinking of doing what around the area etc.
Especially if you are going to house hack, you obviously want good numbers but need to understand what you're willing to spend. Around Boston, house hacking on a good deal can typically allow you to live for free or close to it (maybe losing a couple of hundred bucks a month). But, if you feel like cash-flow is a higher priority for you (which typically is not primary driver of returns on an investment anyway, but that's a different topic), then you would need to expand the radius of your search!
@Lior Rozhansky thank you again for another incredibly helpful response. I think you’re absolutely right about putting the price of the multifamily versus the price of rent into consideration. I think that’s partly why I’m hesitant, you hear in biggerpockets these lower numbers like 100k etc. and think I’d never find that around here. I suppose it’s all relative. A good deal is a good deal. As far as Boston’s economy, I don’t have enough knowledge to make an educated guess but, having seen areas like Charlestown, Eastie and Southie gentrify. My feeling is, how long before these other areas follow suit? I could look outward to areas like Haverhill and Lowell to see how I’d cash flow there. I’m only focusing on cash flow now to replace my income so I can’t quit my job and focus on real estate investing. Again thank you for the input!
@Shayne Mahoney congratulations on deciding to house hack and dive right into real estate investing! I've been all over the state and at the end of the day with the market shifting the way it is I would put my capital in a high cashflow low appreciation area like Fall River, New Bedford or even Springfield if you have the appetite for a great deal.
I've been cashflowing in Fall River for the past 5 years and even though we have appreciated some in this market I am not concerned with the currently market shift because the buildings on MLS still cashflow and return cap rates at a steady 10%.
In the end it's all about where you are willing to live and what you do for a living that will ultimately decide your market, but if your interested in the southcoast we can jump on a call and I can answer any question you may have.
@Gualter Amarelo Thank you for the feedback, a lot of good information there. I'm also really glad to hear you're having success. 10% ROI that's awesome! I typically work in the city doing construction work, that's why I like the north shore to avoid the traffic but I may need to broaden my horizons, seeing as you're doing as well as you are. Again, I can't tell you enough how much I appreciate your time and knowledge.
@Shayne Mahoney - don't forget the accessibility to commuter train and/or buses - which is why there could be some sweet spots for investing (whether buy-n-flip or long-term) in East Boston and north areas, as well as South Shore towns along the Boston-Providence commuter rail line. Think about it, who wants to buy/rent these units in multi-family buildings?
Valid point @Yevgeny Ioffe. Typically people who will be working in the city and want easy accessibility. I like your train of thought, thank you for the input.
Very true, sometimes I forget about those markets because I work in the city myself, and my first property will be a house hack so I’d still like my commute to be a reasonable ride.
Worcester has a bunch of distinct quality rental groups. Colleges, Umass Med, Mass College of Pharmacy, Access to the train to Boston, people who work in worcester, and people who work in Marlboro/hudson who can get there in 15 min from worcester for 2/3 the cost. 1200 sf apartment in worcester is between $1050-1500/month, the same can be $2000 in Marlboro, hudson, framingham. For $350k you can get a good condition 3 unit building that should make $3600/ month and with improvements to kitchens and baths could get $4300/month. if your target is people who live work and stay in worcester you can buy a solid 3 decker for $285k and gets $3150 a month, let me know if you are interested in worcester, i have been in almost 400 buildings in 2018
@Brian J Allen Thank you for the information, you’re definitely opening my eyes to different possibilities around MA that seem a lot more feasible and lucrative. With numbers like that I may have to broaden my horizons. I appreciate it, if something peaks my interest I’ll be sure to reach out to you. Thanks again !
this is what i do. i put 2 under contract this week, and have 2 offers in process waiting responses from the sellers. there are good houses out there, the key is finding the right fit between the buyer's needs and what is available. once the market crests, which it may do at any point, then there wont be many good properties on the market, and we will only be left with the junk which has poor tenants, or is in bad shape and the owners have to sell. it is a great time to buy as good stuff makes it to the market, but prices are trending down overall
I invest on the north shore (Salem specifically) and I think like any deal in any market, it all comes down to what you buy the property for. Understanding the market conditions and what you can get for rents and working through an accurate proforma you could really assess any property in any market. When I first got started I invested down in Nashville and it's gone great but I find myself enjoying being able to drive to my properties as I like doing the work. Boston I tend to find to be a real big boys market where you need cash and a lot of it so I personally have not spent much time looking there for anything.
@Eric Sullivan Thanks for the input! Yea I’d prefer North Shore areas like Salem, Beverly so on and so forth. I think you’re absolutely right about Boston itself. That’s in the distant future lol