Hello all, I want to know what people thing about NYC investing?

Question

As an investor and agent in NYC (the 5 boroughs) I feel like the market is way to high to acquire investment properties that make sense. It is definitely a seller's market right now, so to find properties at a price that makes sense for a decent ROI seems next to impossible. Due to this I have been looking down South, specifically Florida, Atlanta, and Texas. Do people feel the same way for the market in NYC and what would you say is the best state(s) to look for good deals outside of NYC?

Llewelyn A. · Answer

@Joshua Handlarsky

Hi Joshua. I have been Investing in NYC, specifically Brooklyn, for 21 years. EVERY year, I hear exactly what many will say today... "WAY TOO EXPENSIVE" and every year, the property values go up.

What usually drives property values is the monthly rents. So when rents move up from $500 per apt back in the year 2000 to around $1,900 today for one of my buildings, the value of the building increased from $140k back in 2000 to $1.4 Million today.

NYC is a Future Value (FV) play. I don't like to use Appreciation play because if you use that, you negate the fact that it's not the value of the property that is the driving force of the value increase, it's the RENTS. The Rents drive the property values higher.

When you keep that in mind, and you LIVE in a rental in NYC, you better keep in mind that rents in 10 years will be FAR different than it will be today. You can easily get priced out unless you wind up with a rent stabilized apt.

What I like to tell people who are thinking of investing but they want to live in NYC for the long term..... don't say you CAN'T buy a place here... rather say "HOW CAN I BUY A PLACE HERE." ALL of my relatives who did not buy here are priced out. Most have moved out because they cannot afford the cost of living here.

So keep in mind that the danger of NOT investing here is to be priced out, probably within 10 years.

You can read many of my previous posts. I try to help as much people to understand how to invest in NYC. I also try to let them know the dangers of NOT investing in NYC but trying to live here for the long term.

If you plan on moving to another less expensive place, then it may be best to buy there first or you may find yourself out price there too.

Something to keep in mind.

Jaysen Medhurst · Answer

Hey @Joshua Handlarsky, NYC is definitely expensive, but if you're a buy-and-hold investor the appreciation will most certainly be worth it.

For less expensive options take a look upstate (Ossining or Albany), central CT, Western MA, and central PA. They all have their pros and cons, but they're affordable and an easy drive from the city.

Aaron Johnson · Answer

@Llewelyn A. I appreciate the perspective you gave on nyc and will be looking at your previous post for advice.  I would love to invest in nyc myself as i absolutely love this city. I wanted to start off by using an fha loan but by myself i will not be approved for enough to do so.  Do you mind sharing any advice on other strategies i can take.  Thank you in advance.

David Cruice · Answer

No way are you going to be able to cashflow a deal in NYC.  Think about VA, NC, and, SC.  Florida, Atlanta, and Texas are getting too expensive also.

Raul R. · Answer

A lot have your same opinion, it would be great that we could invest in our local market and be able to drive to our Properties but there are too many factors that doesn't make it ideal for beginners which many already pointed out.. I even looked Upstate, but decided didn't want to deal with winter weather and Property taxes in general in NY state are high.. You'll notice as you go South and you research Red States laws are more in favor for Landlords and Property Taxes are more manageable..  I would stick to SE, flights are more inexpensive compare to Midwest something you should factor in most likely at first you might be traveling more than you might like..

Best of luck!!!

David Maswary · Answer

@Llewelyn A.

I sent a PM but in case you didn't get it.......

I live abroad and I'm looking to start a family with my wife. We want to use the strong USD to begin a real estate business in Brazil: I speak the language, know property law, know all the pitfalls and I already own one property. In short, I see it as a great place to begin a real estate investment business.

Our plan is to move back to NY next to my family and invest in real estate there. I consider NYC itself to be an insane investment to begin with (though my dream is one day to develop property in Manhattan) but I'm willing to look at anywhere else in NY. Boroughs, Long Island, Upstate, Westchester, over the bridge in New Jersey, literally anywhere.

I will do whatever it takes to earn the money to buy property to live in. Hell, I already live abroad and I'm investing here to save the money to come back. Is it possible once homeownership is attained to invest in NY and succeed?

My interest, as a newbie, is to find properties that will give me a healthy rental income and as I earn enough from one to keep adding units. I'm aware of how uninformed I sound but I'm ready to sit down, read however many hours of books need to be read, study any bit of contract law that needs to be understood, and essentially do whatever it takes to succeed. Please advise. I'm willing to invest wherever it makes financial sense and there's income to be had and a business to be built. If I had my druthers it would be Brooklyn to Manhattan, but if it's Albany to Ossining I'll take it as well.

Thank you so much for your time!

David Johnson · Answer

same here man I love this city, definitely will think more about investing in the city after reading these posts.

Will Bert · Answer

@Aaron Johnson Have you looked into the NACA program.

Hello all, I want to know what people thing about NYC investing?

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