23 yr old looking to buy in NYC

[Phil Li]

I’m planning to put a down payment on possibly a duplex or triplex within NYC, preferably Brooklyn or Queens. Many people have suggested looking into other neighboring states due to the lower price, but I’ve lived in NYC all my life and have no intentions of ever leaving so I think buying here is a sound decision. My gf and I have been together 7 years and we’re looking to put a down payment within the next two years.

We have a combined income of 160,000 with zero debt and both of us have a 750+ credit score planning to put 20% down with 30k currently saved. We both started working full time recently and we are both living with our parents to maximize our savings. Our plan is to “house hack” and live in one unit while renting out the rest. Ideally we would like to be able to have positive cash flow with the rental income but I wouldn’t be disappointed if it breaks even with the mortgage payments plus any possible repair costs and bills.

My only concern is that I’m not sure if this is even achievable in the area. Also with the new NYC tenant laws in place, is this still a good idea? I’ve been wanting some advice on this but not too many people I know have done this or plan on doing this, at least not within Brooklyn and Queens. Would love to hear some thoughts!

[Abel Curiel]

Hello @Phil Li,

Welcome to the BP forums!

Cash-flowing with a Brooklyn or Queens NY house hack deal is achievable depending on the area and down payment. The best answer to finding out if/how this is achievable would come from a lender. 

That being said, its great that your current living situation is allowing you to save such a significant chunk of your respective incomes. Your projected downpayment amount will get you into a duplex in a wide range of areas in Brooklyn and Queens. A triplex in the $1-1.25M range will likely be found in South Brooklyn and Queens. 

The house hack strategy is a great way to get started in NY. Most people in this market do not anticipate cash flow on their first house hack deal. 

From my experience working with house hackers, here are the reasons folks have used the strategy when building/growing their NYC portfolio:

- They can get in with a low down payment - You can get into a multifamily property property in Queens, Brooklyn, the Bronx, and Long Island with less than $35K.

- They can significantly lower their current living expenses - People currently paying ~$2K/month in rent can pay as little as half of that for their portion of the mortgage (after collecting rental income).

- They gain acquisition, project management AND property management experience - all which will help tremendously when its time to scale and grow the portfolio.

- NYC properties appreciate higher than most parts of the country - of course, this should not be relied upon. Rather, it should be looked at as a bonus!

Best of luck to you on your journey!

Abel