Best starting area for North east noob during covid?

Question

I'm interested in buying cash flowing rentals and wanted to start with SFHs or a cheaper multifam. I'm based out of NYC and this is basically impossible in nyc area. I wanted to start close to home first so I can learn the process in case there are issues and I need to visit.

1) What areas would you recommend close to NYC that would be a decent place to look for a starter rental? $100-200k range and cashflowing. Hoping to avoid bad neighborhoods.

2) I'm reluctant to start in NY bc of the moratorium on evictions and potentially getting into a bad situation from the beginning. Are NJ, CT, or PA better in terms of tenant management and more landlord friendly?

Where should I start looking?

Thanks!

Ramon Guzman · Answer

@Filipe Pereira I’m looking at Hartford, New Britain, Bridgeport, New Haven as possibilities. Sent you a PM.

Filipe Pereira · Answer

@Saurabh Verma

CT is likely the most landlord friendly of the tri-state area (NY, NJ, CT). While Upstate New York does have some decent markets, unfortunately the policies that are Incorporated in the city also impact Northern parts of the state.

100-200K doesn’t get you much outside of bad neighborhoods these days, unfortunately. You may be able to find something in the high one 100s, but at that price point I see a lot of awkwardly laid-out units with mediocre tenants at best. Sure, you make cash flow, but you need to ask yourself if this is something that you want to hold for a long time or just a few years.

I try to buy properties based on where I want to be in the future. Sometimes that means paying a little bit more knowing that in the future I want to have better tenants and less headaches.

David Kiszka · Answer

@Saurabh Verma The Capital Distrcit area of New York has excellent rental property opportunities. There are many smaller multi families in the cities of Albany, Schenectady, and Troy that a new investor can get into without having to go the commercial route with 5+ units. Rent collect is an issue right now for some owners but now is a great time to start looking. Begin your search and narrow down what area you like, what you are looking for, and what you can afford. Feel free to reach out if I can be of any other assistance. Best of luck.

Craig Bellot · Answer

Hey @Saurabh Verma,  the first steps I would recommend as a new investor is to get a handle on analyzing the income, expenses and ROI of these properties in Bridgeport CT.  Connecticut in general is in a sellers market. There are tons of deals on the MLS in Connecticut where we invest. You will need to be creative in negotiating to get the price / terms you need. I believe the key is to act quickly, know your numbers and your buying criteria.You can use the Bigger Pockets calculators to start. Right now rents are strong, you can get $800 for a 1 bed, $1100 for 2 bed, and up to $1300 for a 3 bedroom.  Use Zillow and rentometer.com to get data and analyze a few from your home to see what type if returns there are.If these meet your investment criteria then start looking in person by contacting the listing agent.

Let me know if you have any questions.

-Craig

Michael Doherty · Answer

@Anthony Hawkins Spend some time and money to send out direct mail cards to property owners. Dealmachine is great for that. Set up ringless voice mail and leave messages. Drive for dollars.

Anthony Hawkins · Answer

@Michael Doherty I have been actively searching, finding it difficult since more homes seem to be HUD. What avenue would you recommend taking in finding decent units within Meriden and surrounding area?

Michael Doherty · Answer

@Saurabh Verma how close to NY are you trying to stay? If you are willing to venture out 1.5-2 hours, central Ct has some decent opportunity specifically in New Britain, Hartford, Meriden and Bristol. As Filipe mentioned, you may find yourself if some tough arears at that price range but for multi fams, so a single fam may be your best bet in those towns.

Joshua Lupo · Answer

@David Kiszka. The Capital District is a very hot market right now! A lot of out town, out of state and international money is flowing into the region and sometimes buying hundreds of units at a time. There is still room to run I feel as rents are competitive and the labor market being diverse. Local landlords have been impacted by COVID-19 and rent collection seems like a hit or miss depending on who you speak with. We personally own and operate a small but growing rental portfolio in Troy which is right near the top of the list in terms if cities seeing a lot of development and interest.

Best starting area for North east noob during covid?

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