Feeling overwhelmed... how do I choose an area or location to invest?

Question

I travel every once and a while through Connecticut and Massachusetts. So I'm looking to purchase a multifamily in one of these two states. Prefer Western MA to anywhere along I-91 or I-95 in Connecticut.

Looking for something in the under 250k range - prefer 150k that I can pay all cash and return good cash-flow positive. I do not care about appreciation as much as positive cash flow.

How do I find a good area or location to invest? I don't mind a fixer upper.

Rob Brautigam · Answer

Paul, just reading this post now, and I'm interested in your statement about IREM.org. I visited the site but could not figure out how to search for ARM certified property managers. Could you please elaborate?

Paul Timmins · Answer

Steve

Many good areas. Check the Worcester and Springfield areas a number of colleges student housing rentals can have huge returns if managed properly.

TO find out about an area go to IREM.org search for ARM certified property managers. Call 5 ask them what parts of the city they like/dislike and why. Ask them what they see expenses running per category per unit. What do they see them selling for per unit, what is the market occupancy rate. What are the market rents? Ask them if they know anything coming up for sale. Great way to pick up some good info and possibly a deal.

Paul

Simon Campbell · Answer

Oops, lets change the wording to "Look for areas that have a strong economy..." That's what I get for posting too late at night. zzzzzzzzzzz

Simon Campbell · Answer

Ohhhhhh that explains why you are looking out of the neighborhood. Look for areas that have strong economies and high rental demand. Look for rental rates that have not yet peaked. This will keep the initial purchase price low but if it looks like there could be a surge in employment, rents will rapidly increase and you sit to make a nice profit.

Steve Candor · Answer

@Mike Hurney

I wish. I work/live in Manhattan. I know Manhattan and Brooklyn very well. If I had a few million in cash I would certainly invest here as it know it very well (i work in building management).

Mike Hurney · Answer

@Steve Candor How about where you live?

Simon Campbell · Answer

I would recommend investing in a property that is within a 1 to 2 hour drive of your residence. It will make management much easier. Get a hold of some local licensed agents that have been in the business for at least a couple of years - full-time. Get an idea of rental rates and average home prices. Then choose which area is going to give you the best return for your investment and focus there.

Brian Aube · Answer

Steve,

Plenty of good rental opportunities up this way in Hartford County.  I have a 2 unit at the intersection of 84/91 on the main bus line into Hartford that might be interesting.  Needs a little work, not more than 10K.  Owner Financing is available too.

Feel free to reach out to me if interested and good luck with your search.

Michael Noto · Answer

@Steve Candor  In terms of Connecticut there are definitely some good opportunities on the 91 corridor and just off it in terms of buy & hold multi families.

If you decide to go the CT route feel free to reach out to me for advice.  I'd be glad to help.

Elizabeth Colegrove · Answer

Have you talked to any agents or check realtor.com or zillow.com. Personally its all overwhelming until you get into the weeds. As crazy as it sounds it might be a loss of time but you have to start somewhere :)