Investing in Oswego, Syracuse, or Rochester

[Nicholas Kapner]

Hello everyone,

I've just moved to the East Coast. My wife and I are investigating whether to invest in Oswego, Syracuse, Auburn or Rochester NY. We are looking for cash flow. We're ok if the home multifamily property doesn't appreciate a lot. I've been building and flipping for nearly a decade but I've only been a landlord a few times. Where do you recommend and why? Pros and cons?

[Jeffrey Tonkin]

Nicholas,

I can only speak about the Oswego, NY market. I’m both an investor/landlord in this market as well as an agent. 

Student housing gives the best opportunity for cashflow in this market. There is a “changing of the guard” currently happening with older landlords selling individual properties and small groups. I’m working with 3 landlords that own nearly 70 properties in Oswego combined, and each are stepping towards retirement. I’ve sold 15 in the past 4 months...

As for the remaining residential income properties (families & individuals,) this market is still strong. The cash flow per unit is less, but the prices are still fairly cheap. Yes, there will be a larger chance to have a legacy tenant who has not paid due to covid.

Pros - strong SUNY campus with several off campus students, CAP rates of 8%-18% (depending on deferred maintenance and specific characteristics.)

Cons - typically older homes, students create more work with annual turns and more damage typically, lack of quality management in this area (very few quality managers.)