2023 Real Estate Observations (Boston: rental market, mortgages, maintenance)

[timberline742]

Originally Posted by MikePRU

You're not going to make a ton of money off of a single rental though.

Yeah, the people I know that do this all have multi unit properties. Three families or small apartment buildings. Changes things considerably.

The only person I know that makes good $ on single unit properties is in fairly small town in Wisconsin where he can buy them at tax auction, fix them up with his sons and rents them. He has over a dozen now. Again, different market and different deal entirely.

[MikePRU]

Originally Posted by timberline742

Yeah, the people I know that do this all have multi unit properties. Three families or small apartment buildings. Changes things considerably.

The only person I know that makes good $ on single unit properties is in fairly small town in Wisconsin where he can buy them at tax auction, fix them up with his sons and rents them. He has over a dozen now. Again, different market and different deal entirely.

Yes! Cost of acquisition has a huge impact on profit margins of course. It's hard to get properties "cheap" around here. You could try a foreclosure auction but there's a lot of risk involved in buying a foreclosed property.

[timberline742]

Originally Posted by MikePRU

Yes! Cost of acquisition has a huge impact on profit margins of course. It's hard to get properties "cheap" around here. You could try a foreclosure auction but there's a lot of risk involved in buying a foreclosed property.

Yeah, in that rural-ish area lots of them are trashed, or meth residue, some broken in for wire/copper thefts, but, he gets them for like 20-40k and then sweat equity with his sons. Doesn't happen here, much, I don't think.

[BostonMike7]

Originally Posted by simplexsimon

I'm guessing you're a nice landlord that doesn't max out the rents so you can keep the same good tenants?

Yes. You get a good one tenant, you hold onto them. Stability is great. I'm not managing a multi-unit building though. Different game than those who are trying to make a living off being a landlord. I had one tenant that cost me ~$10K in damages. I think i've told that story a few times here.

[robr2]

Originally Posted by GeoffD

I don't get the $1,400 to $1,600 in real life comment. You can't rent a 700 sf 1970-build garden apartment in Burlington for $1,400, can you? That one would be harder to rent because it's pretty beat up.

The one I saw on realtor.com was $1800 a month. Hallmark Gardens is a starting place for many new immigrant families working in the tech/biotech in the area. They live there about a year and then buy a house.

Even a 1 BR in the bottom half of a typical split is going to run $2200 a month. When you get to the corporate owned places, the number jumps to $3K for a 1 BR.

I kick myself now for not buying a two family in Somerville or Medford when I got married in the early 90's. Having grown up in the 'Ville, I considered myself too good to live there once again. I have a friend that bought a triple decker around that time near Tufts. The rent it generates pays for his house in Lexington and paid the private college tuition for 2 kids.

[BostonBornMassMade]

500-unit housing complex proposed for South Shore Plaza parking lot

[matrix5k]

Originally Posted by robr2

The one I saw on realtor.com was $1800 a month. Hallmark Gardens is a starting place for many new immigrant families working in the tech/biotech in the area. They live there about a year and then buy a house.

Even a 1 BR in the bottom half of a typical split is going to run $2200 a month. When you get to the corporate owned places, the number jumps to $3K for a 1 BR.

I kick myself now for not buying a two family in Somerville or Medford when I got married in the early 90's. Having grown up in the 'Ville, I considered myself too good to live there once again. I have a friend that bought a triple decker around that time near Tufts. The rent it generates pays for his house in Lexington and paid the private college tuition for 2 kids.

So $1800/mo rent, 300k selling price. Still negative cash flow with today's mortgage rates, insurance, HOA, property tax, repairs/maintenance etc. How many years of negative cash flow is typical?

[newenglandgal123]

Originally Posted by matrix5k

So $1800/mo rent, 300k selling price. Still negative cash flow with today's mortgage rates, insurance, HOA, property tax, repairs/maintenance etc. How many years of negative cash flow is typical?

Many investors are cash buyers, no negative cash flow in those scenarios(unless of course you have a tenant that is delinquent and you'll still need money to pay the taxes and upkeep.)

[matrix5k]

Originally Posted by newenglandgal123

Many investors are cash buyers, no negative cash flow in those scenarios(unless of course you have a tenant that is delinquent and you'll still need money to pay the taxes and upkeep.)

Well then let me open up my wallet and whip out 300k.

So basically all the landlord here got their places dirt cheap at low rates or are already very wealthy if they can afford to pay cash? New investors don't really stand a chance.

[newenglandgal123]

Originally Posted by matrix5k

Well then let me open up my wallet and whip out 300k.

So basically all the landlord here got their places dirt cheap at low rates or are already very wealthy if they can afford to pay cash? New investors don't really stand a chance.

New investors most certainly stand a chance....they just have to have deep pockets!