What towns in Massachusetts investors don't want to work in?

Question

So I'm a wholesaler from the South Shore and have been working in it, as well as the North Shore, and as far West as Worcester County, but I've gone as far South to Fall River and New Bedford looking for deals. I know not too many wholesale deals happen off the MLS, but I've been told by a mentor to look at properties that have been on the market for more than 90 days, and a lot of towns around Boston don't have to many properties with days on the market exceeding 90 days, but when I looked in towns like Fall River and New Bedford, there's an abundance of properties that haven't sold for over 90 days. It kind of makes me nervous wondering why haven't investors taken advantage of all these properties, and even though I was skeptic I still negotiated with the respective realtors on a price I felt might make an investor money. But, I was still hesitant on putting ink on the paperwork wondering if I wouldn't be able to find a cash buyer in this area, because I haven't heard of any flips happening in the area. So I backed out, even though I negotiated a multi family down to around 50k, and I understand if the numbers work then it's a deal that will get picked up, but my point/question is, are there towns in Mass that wholesalers like me should stay away from because we'd be wasting our time driving forty miles to and from just to get a house under contract and never get bought by a cash buyer?

I'd appreciate any advice on this!

Ann Bellamy · Answer

Actually, contrary to what you stated, most wholesale deals DO take place OFF the MLS. Not sure who gave you the idea that most wholesalers buy from the MLS and resell to a rehabber or landlord. If it's on the MLS, anyone can see it, and that includes investors looking to buy flips and rehab multis. Even if an investor doesn't have access to MLS, those listings convey to realtor, zillow, trulia, redfin, etc. So most diligent investors looking to buy have already seen it if it's on the MLS. Many of them are also agents. The major exception to this is if you, as a wholesaler, negotiate a price far below the listed price on MLS. And if you are not the agent, but are working through an agent, that is a challenge. Fall River and NB have their challenges with high crime rates and lower employment, so if a property has been on the MLS for 90 days in that area, you're going to need to negotiate a price far below the listed price to allow room for an investor to get a deal and for you to make your spread.There are no towns where no one buys. One person may not like NB, but another investor may specialize in it. Same with other high crime rate cities such as Brockton, Lawrence, Fitchburg, etc So you have to know your markets and know how low is low enough for both of you to make money. Very rural towns will have fewer buyers, and that includes both the flippers, and the end buyer, so I'd stay away from those.So the key is finding off market deals, and negotiating a price low enough. Having said that, I have towns where I don't lend, and those include Fall River and NB. But my reasons are different. It has to do with crime rate and the neighborhoods changing block to block, and my not knowing the markets well enough to differentiate one neighborhood from another. Plenty of investors know those markets and do well in them. So from your perspective, it's the deal, not the town. Just know you'll have fewer buyers in the tough towns listed throughout this post.

Steph C. · Answer

I think it's all relative, but certainly for those of us outside of Boston and the "hot" areas surrounding the city, there are still plenty of deals and money to be made in the south of Boston/Providence metro areas. Sure, the margins are thinner here than in Boston, but are still higher than many other regions of the country.I'm not that far from Fall River and New Bedford and, yes, the home prices are lower there and there are not as many jobs to be had. My husband and I look at properties here and there, too, but typically like to stay closer to home. Plenty of "south coast" residents do commute to Boston or Providence for work and may stay in the area for family or other reasons. I served jury duty in Fall River recently and I swear on every corner I saw a "we buy houses" bandit sign. Now, those could all be from newbies, but I would doubt that there are no real investors there to buy your deals. Here's a local property report for New Bedford from Zillow, mentioning that the real estate market as "cold" - but, you do have to read further, as prices are still rising: https://www.zillow.com/new-bedford-ma/home-values/I would definitely reach out to other active BPers from FR/NB and they can give you a true pulse of the market. Plus, it'll give you more names for your wholesale buyer list, in case you get another deal in the area.Conversely, take a look at this thread, which you may find helpful about hot local markets: https://www.biggerpockets.com/forums/564/topics/44...Good luck!Steph

Larry Turowski · Answer

@Ann Bellamy I think Account Closed meant "from" the MLS. So he would agree with you.

Ann Bellamy · Answer

@Larry T., I can see where he could have meant that, thanks. Well, my discussion of towns still holds, so not a total waste of time. :-)