Where to invest in NE

Question

Where do you suggest investing in New England? Looking for the cheapest place in New England to buy multi families with good rent return, good quality of life, population growth, not a terrible tenant pool and somewhere to be approved for FHA (only a 200k loan) currently looking around Hartford CT, and Springfield Massachusetts. Any advice on property taxes, or anything else about any markets in New England for a beginner investor is very helpful!

Anthony Thompson · Answer

@Ryan Allison we've been discussing some of these topics recently, including the 200K price point and alternatives to Boston such as Rhode Island, in a related thread: Cheap Property Near Boston.

(Since it's almost the same question, I thought it would be easier just to provide a pointer to that page than repeating everything there in this topic too.)

Filipe Pereira · Answer

I'm a bit biased in my opinion, as my property management company manages Hartford County, CT from Bristol to Vernon up to Springfield. Here's some of what I have observed during my time. This is by no means an attempt to push anyone into any market, but rather just some generally vague thoughts.

Windsor is a great "small town" that generates good cashflow with moderate chances of appreciation (relative to the CT Market)

Granby even a smaller town feel than Windsor, rentals are in high demand and rent prices are high. Expect high prices too, though. Appreciation likely.

Enfield is better on cashflow, but has some rough parts of town that I personally avoid (Specifically T'ville). It does have a busy shopping area, and a mall that desperately needs attention. The proximity to MA is a benefit.

Manchester strong rents, but getting into the market can be tough, as multis are priced accordingly.

West Hartford if you're in this town you're probably banking on appreciation, not cashflow.

Glastonbury Strong rents, but expensive. Multis / rentals are not common, and in demand. Appreciation likely.

East Hartford Mostly a B/C class community. I like it. Rents are strong, proximity to downtown Hartford is a major plus. Prices have gone up steadily since 2015/2016. 

New Britain Still has quite a negative stigma, mostly due to crime. I hear it all the time when I'm showing tenants units in other towns and I get asked "Do you have any other units available." You can see the expressions if you say "Yes we have one in New Britain." We manage in town, but I don't feel comfortable enough to purchase in NB myself. That being said, prices can be attractive.

Bristol Strong rental market. Seems to always have demand given proximity to Hartford, Waterbury and Meriden.

Ryan Allison · Answer

@Patrick Hagerty Personally, I would focus on where you plan on taking your next step & let real estate follow you.  If you plan on living in the greater Boston / Worcester / Southwestern CT, you'll find it hard to get any multifamily under $200K.  Central CT has plenty of inventory in that range but I would let your professional career or education dictate where you wind up & let real estate follow.  I'm sure Rhode Island does too I'm just not as familiar with that market.  Like @Jaysen Medhurst said, you may find trouble with lenders as they like to see steady income & will definitely question where you plan on working when you move to your new home as well.

You are definitely on the right track just be patient!

Jaysen Medhurst · Answer

What I meant, @Patrick Hagerty:

• What's your price range?
• What are your income expectations on a MFR house hack? Lower living expenses / break even / cash flow?
• How much work are you looking to work at this day to day?
• Does your work allow you to just pick up and move? You won't qualify for a mortgage w/o steady income and most lenders like to see 2 years of consistency, usually with the same employer.

Patrick Hagerty · Answer

@Jaysen Medhurst I’m a beginner so not too sure, definitly not looking to be in the middle of nowhere or anything like that, but genuinely am willing to go where the money takes me. Wherever the prices are best and rent ratios are good. If I hate living there it’s only a year ! I would love an area where I continue to invest over the next few years.

Jaysen Medhurst · Answer

I live in SW CT and absolutely love it here, @Patrick Hagerty! For living, for investing not so much. The price-to-rent ratios are way to far out of whack. There are some pockets where the numbers work (Bridgeport), but competition is growing, I would never actually live there, and the tenant base can be difficult.

What are your criteria? That will be helpful.

Patrick Hagerty · Answer

@Jaysen Medhurst

Thoughts on southwestern CT? Has me interested being close to NY and all (new haven - Bridgeport area) have definitly put thought into northern RI and Southern Maine and New Hampshire but none of those areas seem to offer the options, affordability and rent prices  as western mass and CT for me. I’m currently 19 and have some options in front me for the next few years, plan on following the money wherever it takes me!

Patrick Hagerty · Answer

@Ryan Allison no I will not be! Hopefully completely relocated to wherever I invest!

Ryan Allison · Answer

@Patrick Hagerty Are you going to be working full time in Boston still?

Jaysen Medhurst · Answer

@Patrick Hagerty, I grew up in Manchester, which is about 15 minutes East of Hartford. Good rental market, but I left for a reason. That said, there's a lot more going on in that area than Western MA.

I focus on SE CT. I absolutely love that part of the state and there are some great places to invest. If being close to the city is important, you should investigate the suburbs of Portland and Providence. I hear those markets are a bit hot, but as the old saying goes, "Live where you want to live, invest where the numbers make sense."

Where to invest in NE

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