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All Forum Posts by: Jerry Nogueras

Jerry Nogueras has started 2 posts and replied 7 times.

Post: NYC Residents- Which areas outside NYC have you seen the most success for rentals?

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4
Quote from @Mathius Gazi:

I picked up a two family last summer in New Haven and it is doing absolutely fantastic. Put in about ten grand and a summer's worth of weekends in sweat equity and the deal is very sweet. Let me know if you have questions, I really went through and through the process on this deal.

 Thanks @Mathius Gazi I'm going to DM you, I have a few questions on your experience!

Post: NYC Residents- Which areas outside NYC have you seen the most success for rentals?

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4
Quote from @Michael Smythe:

@Jerry Nogueras

Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.

Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.

If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.

If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

Similarly, if you put several Class D tenants in a Class A 4-plex, what do you think will happen to the property?

So, when investing in areas they don’t really know, investors should research the different property Class submarkets.

Here’s our OPINION for the Metro Detroit market (use as a template for your target area!) that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases:

Class A Properties:
Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.
Vacancy Est: Historically 10%, 5% the more recent norm.
Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.

Class B Properties:
Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.
Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.
Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 years

Class C Properties:
Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation. Can try to reposition to Class B, but neighborhood may impede these efforts.
Vacancy Est: Historically 10%, but 15-20% should be used to also cover tenant nonpayment, eviction costs & damages.
Tenant Pool: majority will have FICO scores of 560-620 (approaching 22% probability of default), many blemishes, but should have no evictions in last 2 years. Verifying last 2 years of rental history very important! Also, focus on 2 years of job/income stability.

Class D Properties:
Cashflow vs Appreciation: Typically, all cashflow with little, maybe even negative, relative rent & value appreciation
Vacancy Est: 20%+ should be used to cover nonpayment, evictions & damages.
Tenant Pool: majority will have FICO scores under 560 (almost 30% probability of default), little to no good tradelines, lots of collections & chargeoffs, recent evictions. Verifying last 2 years of rental history and income extremely important to find the “best of the worst”.

Make sure you understand the Class of properties you are looking at and the corresponding results to expect.

Thank you @Michael Smythe this is very helpful!

Post: NYC Residents- Which areas outside NYC have you seen the most success for rentals?

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4

Hey Mohammed, 

Thanks for your response! This totally makes sense-- I had a feeling my question was more or less open ended. 

For me personally, I'm looking to start out aiming for cash flow, just trying to find the best deal. 

I will definitely DM you on the side, looking for as much advice I can get, and happy to help anyway I can in return!

Post: NYC Residents- Which areas outside NYC have you seen the most success for rentals?

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4

I'm a long time lurker finally getting ready to start making a move and getting that first rental property.

Being a NYC resident (originally from Long Island), the price of entry in the area is on the higher end, so I've been considering some options in the NY Capitol region, as well as NJ and CT.

I'm curious, to investors in NYC, where have you been able to find the most success? Has it been in surrounding areas, OOS investing, or have you found deals in NYC?

Thanks BP!

Post: NYC Residents- Which areas outside NYC have you seen the most success for rentals?

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4

I'm a long time lurker finally getting ready to start making a move and getting that first rental property. 

Being a NYC resident (originally from Long Island), the price of entry in the area is on the higher end, so I've been considering some options in the NY Capitol region, as well as NJ and CT. 

I'm curious, to investors in NYC, where have you been able to find the most success? Has it been in surrounding areas, OOS investing, or have you found deals in NYC? 

Thanks BP!

-Jerry

Post: 300 Units & 1 Short Term Rental on my first year of taking action

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4

This is a great story Alex--congrats! Looking forward to finally starting the journey and taking action myself!

Post: Our 1 year journey to 22 units & $10,000/mo cashflow without OPM

Jerry Nogueras
Posted
  • Investor
  • New York City, NY
  • Posts 7
  • Votes 4

Super-inspiring, especially for someone just starting out! Looking forward to following your journey...congrats!