New investor looking for buy-and-hold in MA

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Hi all, 

I've been considering getting my feet wet in real estate investing for years now, and only recently begun to consider myself financially (and mentally) ready to jump in with both feet.  

For my first purchase I'm targeting multi-family properties (2-4 units) for buy-and-hold (cash flow).  I'd also like to find something that doesn't need a whole lot of work up-front and would attract a more steady and reliable tenant base.  While anyone from Massachusetts will agree that inside 128 is great for long term appreciation, it seems like not only is it astronomical in price, but also not so good for cash flow.  

That being said, my research is showing that Worcester, Leominster, and Fitchburg all seem to have some quality multi-families that can potentially produce some good cash flow.  Even Springfield seems to have some promising opportunities.  My difficulty though, is that being born and raised in the Boston suburbs, I'm not familiar at all with those areas.  

I'm looking for anyone's advice on whether my thought process is sound, as well as welcoming any feedback from folks who may have gone down this road already (or are doing so currently). Is what I'm looking for even out there? I see lots of opportunities on MLS, but I'd hate to be leaving something off-market on the table. I'd love to connect with anyone looking to brainstorm or trade thoughts and ideas as well - and I'm always down for a cup of coffee, weeknight drink, or weekend lunch.

Thanks very much in advance!  Looking forward to your thoughts and advice

-Phil

[Daniel Consalvo]

Phil  

I am from Leominster.  I have been an investor in this area for 20 years.  Your logic is sound if cash flow is your priority.  Leominster and Fitchburg are good areas for cash on cash returns even with the recent run up in prices. 

 Leominster is an excellent commuter location to 495 based jobs and has a stable economy based mostly on publicly traded strip mall type businesses, plenty of restaurants and increasing rents.  Most of the areas with multi's are B and C areas.  There are D areas which obviously provide the best c.o.c. returns but are the most management intensive.

Fitchburg is a little bit "rougher".  You really need to understand the geography as it pertains to levels of properties (A B C D).  Patrick's post is dead on, you need to drive these areas.  Spend some time on the ground.  

In any city you are unfamiliar with I would try to understand neighborhoods and were the good, bad areas are located.  Sometimes it is in between A and B, B and C, C and D areas were you can find a gem that has the most potential to bring to the next level.

Although the market is not as good as it was a few years ago for deals, they are certainly out there!  You will have to sacrifice some monthly cash flow if you're looking for more of a "turnkey" type property but it is a good strategy when starting out to avoid the big cap ex renovations, especially if you will be self managing.

I currently own in Leominster, Fitchburg, Shirley, Clinton.  I have a strong knowledge of Leominster and Fitchburg Multi fam market.