All Forum Posts by: Brian J Allen

Market Rent for a 2BR in Burncoat/Greendale section of Worcester is probably $1800 for a 2BR with 1 parking space.  I have a client who has one on Francis Street and he gets $1750/month, B+/A- Quality.  3BR go for $1990/month.  tenants pay their own utilities but they have W/D in unit.  Sadly in Worcester people do not value heat as much as you would think.  I figure $200/month year round is more than enough to cover heat.  So pricing could be at $2000/month, if it is exceptional, and has 2 living rooms you might be able to get $2500/month.  Keep in mind that just because someone agrees to a price, does not mean that they can actually afford it. 

Worcester has an interesting dynamic that is not shown in the statistics.  There are a lot of students who may or may not be counted, but that number remains pretty constant.  There are a lot of extended families who live in Worcester who may not be counted either.  I think in many ways you should be charting JOB GROWTH as well, as Metro Worcester may be growing.  As an Economist I have a lot of more detailed thoughts on Worcester and its path that are hard to put on paper in a short format.

@Tyler Benotti, glad to help shoot me a PM

Investment Info:

Small multi-family (2-4 units) wholesale investment.

Purchase price: $294,000
Sale price: $380,000

I bought this to hold, but my tenants never paid and complained all the time. I collected $700 total from my 2 tenants in 21 months of ownership. All the rents that i collected were from State and Federal COVID programs. I didn't want to evict so I sold with tenants in place. Property was worth $410k and I sold for $380k so I didn't have to deal with the tenants. Was upfront with the buyers that the tenants were not paying. Hopefully they will have more success.

What made you interested in investing in this type of deal?

It was going to be a buy and hold

How did you find this deal and how did you negotiate it?

Glad to get rid of it!!!!

How did you finance this deal?

conventional financing

How did you add value to the deal?

I bought at a value price and raised rents over time

What was the outcome?

SOLD and Glad it is gone

Lessons learned? Challenges?

Tenants are the most important part of the transaction.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

WorcesterMulti.com

@Carlos Ptriawan that is great you are able to make $300 installing a window.  Typical price in Worcester is about $100-150 per window

I have a full service window replacement guy I have been using for 20 years.  He will come, measure, fix little things like locks and slides.  If the window glass needs replacement he will order and come back to install. if the full window needs replacement he will do that as well.  Basically cheaper then hiring your guy to go pick them up.  1 man crew can do about 10 windows a day since he only does windows if you are going to do a replacement for a full house.  PM me if you are interested, he only works with people who refer him as he has plenty of work.

@Rahul Munot all depends on the project you are looking to do, lots of good plumbers to fix things and different people if you want HVAC or want to install new.  PM me if you need people

@James K. in worcester you trigger sprinklers (typically) for the following.  There has been a prior fire, you do more than 50% rehab, you add a bedroom, you add a unit(2 to 3) or (3 to 4) and last but not least THEY JUST DECIDE TO MAKE YOU DO IT.  The other big trigger is basically if you touch the electrical with a permit to add a service, then you need to go to code with everything.  As mentioned above the prices are too high.  Sadly there are people who simply need a place to live who will out pay the people who want to make things better.  This is the double edge sword because if you fix things then the units are better and the rent goes up and no one can afford them.  If you don't fix them they are still dumps and likely unsafe (and the rents will probably go up anyway since the new owners have higher cost basis) What is happening is it is driving people from worcester to Webster/southbridge/northbridge/spencer and they are being replaced with people who have been driven from Framingham.  Just like the people from Boston got pushed to Framingham

@James K.. The market has simply dried up. Buyers think that everything will crash so they are on the sidelines. The FHA buyers want to purchase but the FHA NO FLIP RULE and the SELF SUFFICIENCY requirements make it very hard for them. The True investors don't buy flipped homes, and the 25% down buyers are just not around anymore. Keep in mind that we are flipping Multi family not SF. That market is a little different. The reason they only made $5k was they took too long and missed the market. I have another guy with rehab&Hold projects going. Same thing, taking too long. Probably should just sell them instead of trying to hold them.

@Shane Burlingame, it is so hard right now to flip in central mass,  my clients had 5 in the last 2 years, 1 we barely made $5k, and we have 2 going right now that are over budget and prices have dropped so they may just hold them.  Basically you need to be ready to go cash all the time to get a deal.  I have a couple coming up.  Let me know if you are interested and i can get you an address or 2