All Forum Posts by: Pat Clancy

I recently sold a rental property that netted me a 6-figure profit. One of my considerations for my next investment was to purchase a vacation property that I would then list on airbnb and VRBO. I would make much more money doing so compared to renting it for the year and I already have a management company that could handle the property for me.

I told me mortgage broker about this and he said the only issue is debt-to-income. On my previous rental, I was cash-flowing quite nicely, so it decreased my debt to income if that's the right way to put it. In other words, I didn't have to worry about purchasing the next property. 

I'm currently in a position where I will need to sell my current primary in the next year or two and purchase a more expensive primary. Is my mortgage broker correct? And will purchasing an airbnb property hurt my ability to upgrade my primary home because of debt to income challenges?

Does anyone know anything about Rockville CT? It's a part of Vernon and the multis are very affordable. That's about the extent of my knowledge. Wondering if it's worth making the drive out there to look at some deals, or if I should avoid it like the plague?

I would like to piggy back on this as it's also a question I have. Once you find an affordable area, how do you determine which neighborhoods are viable?

I've heard Credit Unions offer lower downpayment options

I can't HELOC because my condo building is only 50% owner occupied. I need 51% for heloc or cash out refi.

Stuck on what to do next…

I currently have a 1 bedroom condo in Boston that rents for $1,700. Over all it is in pretty good shape and monthly expenses + mortgage/HOA by the end of the year come out to around $1,100. So as a rough estimate, it cash flows $600/month. It also is on a highly desirable street in an up and coming area. It includes a parking spot and it's a 1 minute walk to the T. Usually when a condo goes up for sale on this street, it's gone in days, sometimes hours. I'm confident that if I listed it for sale, it would go very quick and I could walk away with $75K towards a 1031 exhange.

Or I could just sit on the cash flow! But the problem is, that’s all it will ever be for the foreseeable future. It is only 50% owner occupied, so I can’t do any cash out refi since 51% would be required. I would like to invest in the next property, but I’m finding myself stuck with a down payment issue since the next one would require 20% down.

I’ve looked into areas in Maine, Worcester MA, and Providence when multis are more affordable and cash flow well. The cons: those areas aren’t in as high demand and the tenants will probably be more of a chore. Pros: I think I could get better cash flow and eventually use the equity towards a second investment property.

Curious to hear peoples’ thoughts on this. I’m faced with potentially exchanging a very good thing for something with a lot of unknowns. 

Thank you all for the feedback! What I'm picking up is yes, it is possible to invest successfully in Auburn/Lewiston, just need to do you due diligence. Anyone I ask in person simply says it can't be done. You all have some great insight.

Thanks, Christopher. You're right about due diligence. I plan to visit soon. As far as population, it has been basically the same at 23,000 for over 20 years. Still working on figuring out what the crime rate is like. Definitely more crime than other parts of Maine, but crime in the state of Maine is on a much lighter level than other states it appears.

Thanks, Jody. I need to look into CoC ROI.

Hi all,

First off, I'm a new member. Looking forward to learning more and sharing some of my insights.

I currently have one investment property, condo, generating $1,700/month with a mortgage/HOA around $1,000. It's been great, but I want to pick up a multifam next and keep growing my portfolio. I'm currently looking in several areas and one of the areas that has caught my eye is Auburn, Maine. I haven't visited yet but plan to do so. They have lots of multis for under $200K and I even spotted a few for under $100K that are close to turn key. One of them was a 6 unit for $180K... so I'm thinking, OK, even with low rents, that could generate some solid monthly profit. That one was delisted though.

What I'm perplexed with is why no one is capitalizing off this? Or maybe they are?

According to Neighborhood Scout, vacancy in Auburn is 8.9%. The average rent for a 2 bedroom is around $700, conservatively. Population is pretty stagnant at around 23,000 and it's been that way for around 20 years. Bates College is nearby, but it's very small and most people live on campus. I don't live in the area, but there are several property management companies that seem reputable. With 25% down, mortgage on $180K would be less than $1,000. Fully rented this thing would bring in at least $4K in rents. Even with one or two vacant, $2.8K should be easily doable and the monthly cash flow would still be there. Should I go for it? Or would you avoid Auburn, Maine.

TLDR: Auburn, ME looks legit for cash flowing rentals, but is it too good to be true?

Pat