All Forum Posts by: Fan Bi

@Philip Ganz I've had good experiences on the commercial side with BankNewport, Pawtucket Credit Union and BankRI but would strongly recommend having a chat with Freedom National. They have a very small footprint but the counterpoint is they bring a strong level of service to their delivery. I work directly with their SVP of Commercial Lending, Laura Stack and would be happy to make an email intro. 

@Stefanos Axios I haven't been in the market for nearly as long as @Anthony Thompson or @Frank Patalano but we have been very active the last three years and from all the historical and current data we've seen, it's not a good time to get in unless you've somehow stumbled onto a screaming deal. 

Providence and surrounding neighborhoods don't have positive inflation-adjusted growth over the long-term (shocking) so to make money in this city you need to i) invest cyclically and ii) have access to good deal flow. In this climate, if you go to an A or B+ grade neighborhood the cap rates are very compressed and if you go below that the cash flow will be incredibly volatile due to tenancy issues. 

One of the macro hopes is that Boston continues to attract jobs and that people will be willing to commute 75+ minutes to get to work because rent rates at ~$1,200 for a decent two-bed apartment is still pretty attractive.

@David Sisson Think you said on a different thread a few months ago that you were looking at MFs, curious why you decided on the SF? I've found that SFs are harder to cash-flow, would love to hear your thinking.

@Mark Green as some of the other folks have said here, unfortunately, there's quite a bit of variance in quality of properties in Providence/ Pawtucket, it makes Rentometer quite unreliable. I have a four-family in the West End of Providence with 2 beds that rent for $800. A three-family opposite that has 2 beds rents for $1,150, partly because they pay for utilities, partly because they've got nicer finishes, partly because they've done better tenant marketing.

I've got a dozen 2 beds in Pawtucket and none of them rent for more than $850, but they're also C grade properties. 

@Thomas Ferreira Jr. I've mostly worked with listing agents directly. Personally, I'm comfortable negotiating on my own behalf, and I'm happy to do the work searching on MLS for opportunities. I've also found the listing agent a bit more motivated to close a deal when they're seeing both sides of the transaction.

@Brian Olencki Congrats on your first property! I've unfortunately had to turnover a few tenants in RI in similar situations, i.e. bad previous landlord mismanaged and developed bad habits or just got bad tenants to begin with. You'll spend 3-6 months and a lot of pain to only end at the same conclusion, which is you want to screen your own tenants. 

I'm curious, what part of RI is it in?

@Colby Mulry Do you mind me asking what part of Rhode Island the property is in? 

We've got a number of multis in Providence, Pawtucket and Central Falls, but all would fall in the C neighborhood category and we've  had a rough go of it. It's a constant struggle between the small, short-term cost of late payment vs the much bigger cost of tenant turnover. 

According to MLS data, the multi-family market in Providence and Rhode Island cratered as it did in most of the country between 2007 to 2010, going from a peak of around $280,000 per residence to $100,000. But what was it actually like?

- Even if you had the cash to buy on the cheap, was anyone lending

- If you bought sensibly and cash-flowing, did you even care because you could carry through the crash

- Was the rental market hotter because homeowners became renters, or was it colder because tenants couldn't afford their rent

cc @Anthony Thompson

@Brett Prescott Congrats on your first purchase, it's 90% of the battle getting into real estate. What areas are you looking?

@Joe Benson Would you be willing to share, or PM, the property details?

First of all, props on investing at 23. I wish I'd done the same. You'll be glad you did in five years from now when all your peers are buying their first home and you already own five!

As an out-of-state investor into RI, I accept the trade-off I'm making. In RI, I can get good cap rates with great entry-level pricing, but less long-term growth and more work driving from Boston. It's also a smaller market so there's less aggressive competition. We use a property manager and because we've scaled up a bit, we pay 7%.