Are there good cash flowing opportunities in CT?

Question

Hi all,

I'm currently looking for my first deal as a buy and hold investment and working out whether to stay local or go out of state. I live in Connecticut and have been looking at Bridgeport as an option, but property prices are on the rise, so wondering if I'd be better going out of state to find something more affordable (and maybe better cash flowing) to reduce the risk if I can't get tenants. Any suggestions would be welcome and would love to Connect with others who are either investing in Connecticut or live in Connecticut and investing out of state...or anyone else that can be bothered to talk to me haha!

Thanks
Connor

Taylor Shapiro · Answer

Hey @Connor Parker, nice to see another CT investor posting on the forums. I can't speak to the opportunities you might find out of state, but from what I gather, we're seeing low supply and high demand in just about every market. Competition is high everywhere due to low inventory. I've been investing in CT since 2014 and I've never experienced a sellers market like this. If you're just getting started in REI then I'd recommend using this time to practice your underwriting skills. Look at, and underwrite, as many deals as possible. This way, when a good one comes through you'll be ready to pounce. Investing out of state is challenging enough in a stable market, even for the most experienced investors. Stick to your own backyard, land a deal or two, then maybe look elsewhere. Just my two cents.

William Collins · Answer

I would agree with @Taylor Shapiro that this is a seller's market.  It really depends on what you are trying to do @Connor Parker.  I would suggest a house hack if you could for your first BRRRR.  The rates you could get on an owner-occupied would totally pencil out.  For example I have a triplex I am about to move. It is in New Britain. Zestimate®: $256,684

Somewhere between $250k to $275k realistically.

Rents are low right now $950, $900, $675 on three two bed rooms.  There is room to move those up to 1,110, 1,000 and 800- but lets go with the originals I have. 1st floor tenant is moving out in June- perfect time to sell to an owner occupied.  Even at the under tent $900 and $675 a qualified buyer is still in the money for owner occupied rates:

Mortgage amount$250000 Interest rate (%)3.92 Mortgage period (years)30 Monthly payments$1,182

Connor Parker · Answer

@Craig Bellot thanks Craig, Appreciate the advice! I’ve been focusing on analyzing deals and have been second guessing my numbers, but the thing I realized is that unless I get my financing in place ready to push the button I’ll never get to the point of offer or take the plunge

Craig Bellot · Answer

Hey @Connor Parker, 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.You can use the Bigger Pockets calculators to start.  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.

Let me know if you have any questions.

-Craig

Taylor Shapiro · Answer

@Connor Parker send me a PM. I'm always up to talk shop

Connor Parker · Answer

Thanks, appreciate the advice!

William Collins · Answer

@Connor Parker  Waterbury is a special town.  It has potential, but it is not where I invest at all. Or am I looking to. Take that as you will.

Connor Parker · Answer

Thanks Will,

The numbers sounds great! Unfortunately I already own a single family, so house hacking isn't an option (unless I can convince my wife to move). I realize BRRRR can bit risky if you aren't familiar with the cost/time/management of rehabbing a property, but one of my best friends is a contractor, so hoping he can help me avoid any major mistakes. Interesting that you said New Britain as I was looking there - I think I saw it in an article of best places to invest in CT. What do you think of Waterbury? I've been looking there as it's a little cheaper and although rents are less I thought it might provide a lower cost entry point, although I need to look into the market a bit more.

Connor Parker · Answer

Hi Taylor,

Thanks for the advice. I was leaning towards staying in CT given I'll be able to drive around neighborhoods and get a better sense of what I'll be investing in, so this helps. I've be thinking about what the best strategy will be and leaning towards the BRRRR strategy as if I look for turnkey or almost turnkey properties I'll have to keep coming up with capital for down payment and unfortunately I'm not a multi-millionaire (yet) with lots of cash hanging around! Are you still doing flips or have you slowed down because of the market? I would love to pick your brain and exchange some ideas if you're up for it. I went to a real estate meet up in New Haven at the beginning of the month run by Ryan Luby - met some interesting people - do you ever go to that?

Are there good cash flowing opportunities in CT?

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