All Forum Posts by: Luan Oliveira

@Account Closed Everyone is going to have different tolerance for the lower-income neighborhoods. I own in the "West End" on the other side of Cranston St as described above. I also lived there for three years, so I know first hand what to expect. That said, you may be dealing with tenants who may not have the typical background/credit info you many times see on here, so you'll have to be flexible with your screening. Nevertheless you can get great tenants. I've never had an issue with mine.

I can tell you that there is a very high demand even in the lower-income areas. Two bedrooms will rent out at $1200-1300 easy, and 3brs will rent out at 1500. There is also a high demand for decent clean units. If you have an updated, painted unit with parking, you'll have no trouble attracting good hardworking tenants.

As Anthony said, the West End has different meanings to different people. If you look at Providence maps, you'll see it as both sides of Cranston St. others will say it's from the Armory to Federal Hill. Who really knows....

Ultimately you'll have to assess you risk tolerance and go from there. I also recommend driving the neighborhoods at different times of the day. Providence is an interesting place. Once second you're in hipster central, and the next corner it's a block of abandoned homes. I think your best returns will be on the updated homes in the lower-income neighborhoods.  As long as you're willing to do a little more work! Just don't get a shabby looking home in those areas, because those will attract bad tenants.

 

 I believe that's Providence and not North Providence.

I'm a fan of Josh at JML Home Inspection

@George Post what's the Zip? I don't see a Windmill St school in North Providence. Keep in mind North Providence is a separate town. I do see a Windmill St school in the north part of Providence. Just wanted to point that out as sometimes the difference in names is not all that apparent. Just like the East Side of Providence is located in Providence, and East Providence is a different city across the river.

@Anthony Thompson Gotta love all those "East Side" listings for any property east of 95!

Providence can be very street by street. At the end of the day, I think it'll all come down to your risk tolerance. Are you willing to take on a C/D property and deal with any potential gripes in order to make a bit more cash flow? If so, then you may do very well. Areas like Federal Hill and the East Side are going to be much more expensive, and you may not be cash flowing as much.

Make a list of some properties you find interesting on the MLS, then spend a day driving those properties. Even better, do it on a Friday evening or Saturday evening, where you're bound to see most people around and get a picture of what the area is like. At the end of the day, I think one of your best tools will be how you screen people.

I've lived in Providence for about three years and am always amazed by how quickly the atmosphere changes from street to street and many times even a few houses down from each other! One other tip would be to look at some of the cities surrounding Providence. You may be able to command a higher rent and get a better quality tenant. I recently purchased a 3 family property in North Providence (which is a totally separate city) and was able to get over 1% in rents, which many people around may want to tell you is not possible. Another danger in PVD is the tax rates for non-owner-occupied properties so watch out for that!

@Abe B. I've had the luck of purchasing mostly vacant properties. I do have one tenant who is under market, where I have not raised the rent yet. When I do start raising the rent, I will most likely do it gradually, rather than all at once. They're great tenants who never bother me, and the rent is always paid on time. So that's something to consider too.

The other thing to consider is what turnover costs would be if the tenants were to move out. In my case, I'd have to spend 6-8K to revamp the unit. In that case, it makes more sense to me to keep a good tenant at a lower rent for now!

@Abe B. Are you looking at small multis or 5+ units?

I've purchased three 3-fam properties in the last three years all off the MLS and have been able to get a greater than 5% cap rate. And that's accounting for vacancy/repairs/capex/property management. In two of those cases, I had to offer close to 10% over asking to get the deal.

The rental demand out here is crazy. If you have a nice unit, you can command top rents even in the C/D neighborhoods. Renters are tired of seeing units that are in disrepair and where the landlords don't take care of the property. My most recent post for a 3 bedroom ($1650) garnered over 200 Facebook inquiries before I took down the listing. If I were you, I'd focus on nicer homes where a lot of the CAPEX has been done for you.

Don't always rely on the existing rents either. You have to be ready to ask the tenants to leave, then spruce up the units to get top rents (fresh paint and floors will make a world of difference). Alternatively, be ready to raise rents on existing tenants.

@Fernando Vitorino I've lived in the West End on one of the "rougher" streets for almost three years now. That said I put rougher in quotes because in all the time I've lived here, I've never noticed ANY issues which I think were a public danger. Are there drunks and other people needing help on Cranston St? or course! That said, I think the police have been making their presence known quite a bit more in those sketchier blocks. 

One of the big differences I've seen compared to some of the other neighborhoods appears to be infrastructure. Over on this side of the street, it's crumbling sidewalks and pothole-ridden streets for days. I think if the city were to repave the streets, fix all these jacked-up sidewalks, plant some trees, and do some general cleanups, the area would look a lot more inviting. Also, make sure absentee landlords keep their properties up to a clean standard. There are overgrown lots on every corner. 

The area just looks plain ugly. Invest some money in making it look better and I think the people will come! This can be evidenced by all the mill developments that are in the area. Once the buildings are looking nice the people come! It's very street by street, and many times even a few houses down can be a huge difference!

@Jim Cellini I'd reach out to Jim Murray at Lyon Property Management. I've heard nothing but great things about them. When it's time for me to transition to property management he'll be the first one I call.

@Dylan Hess another factor to consider right now is building cost. Material costs have gotten pretty expensive lately. I'd suggest reaching out to the seller to pricing. Then you'll be able to run some numbers to see if it makes sense!