All Forum Posts by: Brian J Allen

Worcester is changing a lot. Many more places over $500k, and the CAP rates are shrinking. WE are seeing more buyers every day, but you need to pick and choose the properties very carefully. The seller are looking for NO INSPECTION offers to move the process, or inspections within 5 days to get right to P&S and get the banks moving. There are deals out there on commercial/mixed use properties which tend to have higher CAP, but you need commercial financing.

Unfortunately I had one where it was a SF in a multi neighborhood by a college, and the projected rents justified the price.  But the bank went on ONLY COMPARABLE SALES and we were too far off.  Place was a great house hack/investment, but we couldn't make up the difference.  The key to getting the good appraisal in the SF in a Multi neighborhood is to have a local bank/appraiser.  If you are doing a multi in a multi neighborhood, often it helps to have an out of town bank and appraiser as the guys from Boston think Worcester 3 deckers are undervalued.

There are lots of ways to find things.  But in Worcester the key is knowing where you are buying.  Rents change street by street so you really have to be careful.Also, certain areas houses appraise and others don't.  eg.  A SF in a Multifamily neighborhood likely is worth more than the bank thinks, same for a MF in SF neighborhood as the comps aren't there.

shoot me a message as well.  I may be able to put a cell tower on the land.

I would be glad to meet up as well.  Brian.  I also go out almost every Saturday Morning and do tours of worcester multifamilies that have open houses if you want to join.  we had 5 buyers last Saturday and 4 the Saturday before

Welcome Jennifer. Not sure about Lake County IL, but I know Worcester and it is hot. The key is knowing your financing as it will set the path to what you are able to buy. There isn't much you can buy with FHA without overpaying or doing a 203K loan, but 25% buyers are doing quite well in Worcester. I would be glad to help you get going in Worcester.

@Alexander Rosario, This is a tough ask. First off it is very hard to get both appreciation and high CAP Rates/Cash Flow. This is the risk reward part of investing. The lower the risk, the lower the CAP rate, the more likely you are to have appreciation. I am intimately familiar with the Worcester Market for the last 20+ years and the multiple cycles we have seen. The multis in the best locations (surrounded by SF homes) have always maintained value in the ups and downs. The ones in areas Full of Multis and on hills, with limited parking have risen and fallen more quickly. You can try to time the market if you like, for appreciation but that is difficult. Ultimately in Worcester, Springfield and Fall River, a majority of the Multi family properties trend to the price of rent. Worcester has had huge rental appreciation over the last 4 years. Average 3 BR apartment in Worcester was $1326 in 2017 and in 2020 it is $1742, that is SECTION 8 Rent based on HUD statistics. THAT is 31% increase !!!!!!! This pretty much mirrors the multi family price appreciation. If the Helicopter money from the FED continues and we have inflation, one of the few ways to keep up with inflation is to own appreciating assets like real estate. But keep in mind, the best multis are in the areas with the least amount of multis, as they are where people prefer to live!!!!!

Agreed, Worcester is super hot.  Even the junk is selling, things with no parking on busy streets built into hills!  

The key to Worcester is the neighborhoods.  Many are very livable with parks and access to the North and West with places to hike or go skiing.  Providence has better jobs for higher earners, but Worcester has tons of $50k jobs which always make tenants for life.  People stay in their neighborhoods and live there.  There are also neighborhoods with mixes of multis and SF homes.  Also, the colleges are spread out and places like Clark and WPI are integrated into multi family neighborhoods not gated off from them.  Always willing to discuss Worcester with anyone anytime.

There is such interest in Worcester now that a lot of the sellers are going MLS and the prices are rising. There are still off market deals, but cash buyers are able to get stuff on MLS and they are not quite as savvy.