Is a 2% (or even 1.5%) Rule SMF in Worcester too much to ask for?

[Andrew Albert]

My wife and I have been researching and visiting small multi-family properties in the Worcester, MA area. We're finding opportunities in the lower income areas but it seems most, if not all, barely meet the 1% rule... leaving very little wiggle room to reach positive cash flow. Not to mention the majority will require some updating and rehab.

Is that something to be expected in this area or are we not finding the right properties?

We are interested in connecting with multi-family investors in Worcester - coffee is on me. Love to pick your brain about the Worcester market and any advice or suggestions you might have for new investors. Please let me know!

[Bryan Devitt]

Cameron nailed it. Multi prices went from stupid to insane over the last two years. The only people I know getting the 2% rule are buying off market gut jobs in cash with quick closing then dumping a ton more cash into the rehab before getting their cash back out. All of the MLS listings I see barely break even and are going to have to hope for appreciation. I personally don't think it will be worth touching the city until the next serious down turn unless you have $500k or more in cash that you can tie up for 6-12 months