All Forum Posts by: Stephanie Jacobson

Although I believe @Joseph R. Smith posted the correct answer, I would still argue that "upstate" is everything north/west of Albany. Everything else is downstate. The places I've never been by Watertown are "North Country". Western New York is all the places where people speak like they're from Minnesota.

Source: grew up in Rochester, totally unbiased. 

PS- By Joseph's map my territory includes Central NY, the Southern Tier, and the Finger Lakes. I would not call Rochester part of the Finger Lakes region, though.

@Jimmy Bermeo fantastic! I'll send you a DM. 

This is a great post! As a multifamily specialist, I'll keep my thoughts on that specific group.

 I tend to prefer working with multifamily under 15 units, but it depends on the investor. Some investors want a truly hands-off approach, and in that case the more units under one roof, the better. But many people like having a feel for what's going on at their property, and find controlling their reputation and product is easier with small or mid-sized buildings. Either approach is good when it comes to multifamily. The key to success seems to be aiming for growth while maintaining a good product, whether that means buying bigger buildings or focusing on a niche of small-to-mid-sized buildings. 

One thing I don't love seeing is single family portfolios. They have too many roofs, too many lawns and driveways, too many complications, and are hard to liquidate. The only exception I'd make here is a group of successful STR properties with solid rental histories. But for long-term rentals, I try to avoid advising people to collect a group of single family homes to rent.

 Oh hooray. 😑

@Erin Bergold OCREI is a great group! They have in-person meetings, and they also have chats often by Zoom. 

https://www.ocreic.org/

 How about some specific info on Rochester so we all can learn about it? 

 It depends on where you're looking. The issue with the downtown areas right now is mostly an inventory problem, actually: there are very few good, cashflowing options on the market. That means when something comes on that has good rents or is in good condition, or both, there's a ton of competition for it. That's what the OP here has been up against.

You can find decent cashflow on paper in Syracuse right now, but not in areas expected to benefit from Micron's growth. There's a lot of speculation, too. What kinds of employees will be hired? How many will be local? Will these folks prefer to buy suburban or rural homes, or will they want to rent and eventually buy within the city? The answers to those will come in time, but for now buyers are taking risks buying properties with poor cashflow or in poor condition.

There's definitely potential. It's about keeping your eyes peeled and finding that great deal! Even if you're aiming for appreciation and want to hold more than five years, you'll still be gambling a little bit basing your purchase on Micron.

 Yes! I have folks ask about the capital region and I don't cover it, so I'll drop you a message about referring some folks to you.

 THANK YOU for posting some actual sound info and data on these markets!

*cracks knuckles*

Alright, here we go.

What are your goals? You can find a market in New York to accommodate pretty much any investment style. The three markets I know the best are Syracuse, Binghamton and Ithaca, and they're radically different. I understand the capital region, the Adirondack region, and Western New York (Rochester and Buffalo) have their strengths and weaknesses, but I'm going to focus on this central part of the state.

Binghamton is my favorite investment market for a few reasons, but it's not for everyone.

STRENGTHS
-  low prices
-  blue collar overall, meaning lots of resources for contractors
-  growing university, consistently growing rents
-  I expect to see an actual 10% cap rate here, higher if the property needs work
-  compared to downstate, permitting, evictions, etc. are simple and quick
-  no code compliance inspections required on existing multifamilies

WEAKNESSES
-  no. natural. appreciation. Like at all. Do not bank on it. It just won't happen
-  low ARVs even if you do renovate. Be very careful when calculating for a refi or sale
-  recent zoning changes have been confusing and ridiculously restrictive for student housing
-  some properties are $50k for a reason, run
-  it looks... bleak. And depressing. It's fine. We're used to it.
-  lots of downstate absentee landlords have let properties go to crap. Don't do that

Summary: Binghamton is the best market upstate, hands-down, for cashflow. It's the easiest to work in as far as regulations and rehabbing. Student rentals really drive the market, but thanks to recent zoning changes, legal student rentals are incredibly hard to come by. If you choose to buy here, pay very close attention to zoning, and run your BRRRR numbers conservatively. Rent varies wildly depending on condition, who your tenants are, and where your property is located.


Ithaca is like another planet.

STRENGTHS
-  appreciation is pretty much guaranteed, no matter how crummy your property is
-  student housing isn't restricted, they'll live anywhere
-  having an ivy league school means there's a lot of money flying around
-  rent is high
-  tons of development and growth going on
- strong STR performance outside the city proper

WEAKNESSES
-  almost absurdly high prices
-  similarly absurdly low cap rates
-  pesky annual inspections required on multifamily properties
-  most deals happen behind closed doors, and agents tend to be very unhelpful
-  5-7% cap rates typical, sometimes lower

Summary: Ithaca is a great market to park your money in and wait. You don't have to do anything to your property, it will sell for higher than you bought it for last year. If you have a pretty place that's furnished nicely, you can rent to students for more than $1100/bed, which can add up for large, older homes with many bedrooms. Watch out for those pesky annual inspections, though- they'll get you just because they feel like it, after letting the last owner slide for some twenty years.


Syracuse is a sort of happy medium between the two. 

STRENGTHS
-  strong affordable housing market
-  cool city with a great feel
-  nicely mixed neighborhoods with properties in need of repair next to nice homes
-  large university, robust medical community
-  decent rents overall, currently trading at 8-10% cap rates
-  Micron promises growth

WEAKNESSES
-  Micron hype is making people spend way too much on properties
-  pesky code compliance inspections here too
-  student housing area is incredibly compact and difficult to get in to
-  difficult to predict if a property will benefit from renovation or not
-  contractors are overwhelmed, difficult to get estimates

Summary: Syracuse is experiencing a lot of change right now, in a good way. They're anticipating the entire landscape being changed by Micron over the next few years, which is cause for plenty of optimism and excitement. You're rolling the dice a little bit, banking on that though, so when just starting out, stick with a solid rental that's performing well enough within commuting distance from Clay.

Alright, hope that helps! I'd love to see some other agents/investors weigh in on Rochester, Buffalo, Albany and other cities up here. Good luck @Marika Aubrey, keep us posted!