Best Single/ Multi Family Locations for Beginner Investor (<300k)

[Sean Maiden]

Hi all,

I am currently considering investing in either a single family (3bdr+, house hacking with roommates), or up to a 3 unit multi-family (living in one of the units). I moved to MA a couple years ago and I'm still not too sure which areas are good or bad places to live though from what I've gathered crossing the wrong street can quickly take you from a decent to bad area. Some areas I've been looking at include: Nashua NH, Lowell/Worcester MA and Pawtucket/ Providence RI among others. All seemingly have their good and bad.

Questions:

1) Recommended locations to invest based on criteria below?

2) Being a noob with no real connections, how does one get started connecting with wholesalers or otherwise getting access to properties not listed to the public? Based on my analysis, most properties for sale on Zillow cashflow only a few percent for multis and barely at all for single families.

3) Considering I invest elsewhere and can wait as long as needed for a good deal to come around, should I engage a relator now or wait until I am able to find good deals? I don't want to be wasting a relator's time window shopping.

Considerations/Criteria:

- Budget: Approx. 200k for single family, 300k for multi-family. 350k absolute max.

- Class B property. I understand I can't afford anything fancy though I want to avoid sketchy.

- Work full-time in Waltham and would like < 1h commute.

- Mid 20's professional.

- Move-in ready, allowing repairs over next 5+ years.

- Positive cashflow property located in area on the rise.

- House-hack a new property after a year or so and rent previous house-hack property fully.

Any suggestions would be greatly appreciated.

Thanks, SM

[Anthony Thompson]

@Sean Maiden if it were me, I’d focus on keeping the commute to a minimum since I do believe it adds up a lot over time. Unfortunately, as you may have noticed, many properties in the greater Boston area might not fit into your desired price point/budget. But if you feel pretty settled in Waltham or your current job you could try to find something on the far side of Waltham (relative to Boston) which would still be a good commute.

I’m not that familiar with Nashua as I haven’t lived there for over 20 years (and that was only briefly), but the prices you listed do fit in with Rhode Island (Providence or Pawtucket) very well. I think the commute to Waltham would grate on you over time though, and TBH there’s a lot more economic activity and jobs in Mass than RI.

If you engage a Realtor you will, pretty much by definition, be paying market value (with rare exceptions you shouldn’t count on being able to find on demand). Wholesalers are one way of finding off market deals, but wholesalers are generally looking for cash buyers so if you’d be using a bank loan most wholesalers aren’t going to want to work with you. Most are also looking for experienced buyers, mainly to minimize the chance of a newer person getting cold feet and backing out at the last minute.

If you still want to meet wholesalers to build your network there's nothing wrong with that, and my usual advice is to go to local real estate investor groups such as RIREIG in Rhode Island or Black Diamond REI in southern Mass. I've been to both groups and they are education and networking focused (rather than trying to sell you stuff) so I can recommend them.

The “best” way to find off market deals is to work directly with sellers one-on-one, no agents involved. Doing so is not usually easy though, especially if you’re trying to find a below market deal, as it will take regular application of time and money to find such “motivated sellers”, but the best deals you’ll do in real estate will the deals you find and put together yourself.

As far as how to do that, and understand that it could take 6 months and at least one or two thousand in marketing to even find something that’s remotely a deal, there are a lot of very good resources here on BP. Just do some searches on direct marketing, finding deals, direct mail, list brokers, etc.