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I live in Portland, and it's pricey. I need good renters in an area with jobs. Hard to find in Maine. Considering Bath. Biddeford is cheap but...Biddeford. Saw some multis in Rockland last weekend; aside from the tourist and retiree element, that area is depressed. Brunswick isn't looking so hot either, especially given the closing of BNAS.
I live in Portland, and it's pricey. I need good renters in an area with jobs. Hard to find in Maine. Considering Bath. Biddeford is cheap but...Biddeford. Saw some multis in Rockland last weekend; aside from the tourist and retiree element, that area is depressed. Brunswick isn't looking so hot either, especially given the closing of BNAS.
Thanks in advance for ideas.
I don't know what this thread is about.
Are you planning to build an apartment building to rent to others? If that is the case then I would suggest that you consider the kinds of rent assistance programs that are available and build to suit one of those.
Having been in the renovation and building business since 1990 myself, one of the last things that I would plan to do right now, is build ANYTHING on speculation. The entire population of Maine is not going to move very far very fast for a while because the economy and financial markets are still locked in place. Until and unless the economy shows signs of real improvement the development business will remain dead.
Having said that, the best areas are right where you are, because that is where the majority of the population is.
Having been in the renovation and building business since 1990 myself, one of the last things that I would plan to do right now, is build ANYTHING on speculation. The entire population of Maine is not going to move very far very fast for a while because the economy and financial markets are still locked in place. Until and unless the economy shows signs of real improvement the development business will remain dead.
Can you give us your thoughts as far as "flipping" go? Do you think that buying & renovating homes is a bad idea right now? We are considering doing a couple of homes per year, maybe 3 as a means of investment and income; doing most of the work ourselves and working with a local realtor around the Rockland/Waldoboro area. Thanks for your insight!
I live in Portland, and it's pricey. I need good renters in an area with jobs. Hard to find in Maine. Considering Bath. Biddeford is cheap but...Biddeford. Saw some multis in Rockland last weekend; aside from the tourist and retiree element, that area is depressed. Brunswick isn't looking so hot either, especially given the closing of BNAS.
Thanks in advance for ideas.
WOW, you still need to be more specific about what it is you want. 2 units, 3 units, 4 units ect. how many bedrooms? Yes Portland is expensive... but rents are higher.. So are you just looking a specific cap rate? Which is the best way to buy any multi unit..especially for investment I feel.
Biddaford??? I am not familiar with the city all that much but I know its reputation.. I own mulit units in Lewiston and will say that no matter what town or city you live in there will probably be some areas that are undesirable..
Lewiston's outskirts offer middle class suburban quality life style and the cost/rent relationship are excellent.
With regards to Portland.. remeber that there is a reason why it is more expensive..
I started off with a two family and lived in it for 5 years.. I still own it
Can you give us your thoughts as far as "flipping" go? Do you think that buying & renovating homes is a bad idea right now? We are considering doing a couple of homes per year, maybe 3 as a means of investment and income; doing most of the work ourselves and working with a local realtor around the Rockland/Waldoboro area. Thanks for your insight!
I think "flipping" is dead.
There is little new employment in Maine, and in fact, many "old" employers have had trouble maintaining their regular employees. People who are looking to buy a home right now will have to have bullet proof financials in order to qualify for a loan. And in order to do that they will need to have a great job and have been in it for some years. Most will not qualify.
Maine is going to reap what it has sown. The foolishness that Maine can live as a "tourism based economy" is a fallacy. Tourism provides many part time, semi- or fully seasonal jobs that generally pay minimum wage. Tourism as well as the retail sector provided by the "big box" development do nothing to create wealth in the economic environment. Maine has systematically forced business and industry to leave for warmer climates and political climates that didn't seek to punish the value of capital. Maine's "traditional" industries...pulp, paper, forestry, fishing and earlier than that, shoes and textiles...have all been driven away. Pulp, paper and forrestry are industries of the past with little value to add as civilization in general goes away from paper as a valuable commodity, and even building and construction are using more and more manufactured products and fewer and fewer dimensional products made from raw forestry. The fishing industry is dying off until ground stocks reestablish themselves, and of course, we can thank Saint George Mitchell for giving away the best parts of The George's Bank fishing grounds to the Canadians.
So far no politician has come forth with the truth about Maine's employement prospects. As a state we keep trying to patch together systems that will hold the line, but over the past 35 years, that "line" has gotten further and further behind the true cost of living for most people in this state.
Maine could assume a true leadership role in new construction and buidling materials, new high grade insulation products and new, high efficiency windows and doors, but there is little impetus to do so, as the politicians are only running for the NEXT election, rather than the welfare of the people who they dupe into voting for them, election after election.
For investment of capital I would find a different place to put money. I like real estate in Maine, but the only real estate that is really valuable for investment purposes is waterfront property, and that is so enormously expensive that the return on investment will be measured in decades, I fear.
As far as renovating houses and "flipping" them...if you mean in less than ten to fifteen years, I would pass, unless you find something so far below appraised value and so easy to fix quickly as to enable a strong post tax gain in the first year or two of ownership. That will be extremely hard to do.
The true cost of this recession is yet to be established, and my guess is that Maine will become a poorer state by far, and remain that way for years measured in decades.
Can you give us your thoughts as far as "flipping" go? Do you think that buying & renovating homes is a bad idea right now? We are considering doing a couple of homes per year, maybe 3 as a means of investment and income; doing most of the work ourselves and working with a local realtor around the Rockland/Waldoboro area. Thanks for your insight!
Flipping is good in ANY market as long as you know what you are doing.
It is way more involved then just buying, fixiing up, and selling for more money.
There is little new employment in Maine, and in fact, many "old" employers have had trouble maintaining their regular employees. People who are looking to buy a home right now will have to have bullet proof financials in order to qualify for a loan. And in order to do that they will need to have a great job and have been in it for some years. Most will not qualify.
Maine is going to reap what it has sown. The foolishness that Maine can live as a "tourism based economy" is a fallacy. Tourism provides many part time, semi- or fully seasonal jobs that generally pay minimum wage. Tourism as well as the retail sector provided by the "big box" development do nothing to create wealth in the economic environment. Maine has systematically forced business and industry to leave for warmer climates and political climates that didn't seek to punish the value of capital. Maine's "traditional" industries...pulp, paper, forestry, fishing and earlier than that, shoes and textiles...have all been driven away. Pulp, paper and forrestry are industries of the past with little value to add as civilization in general goes away from paper as a valuable commodity, and even building and construction are using more and more manufactured products and fewer and fewer dimensional products made from raw forestry. The fishing industry is dying off until ground stocks reestablish themselves, and of course, we can thank Saint George Mitchell for giving away the best parts of The George's Bank fishing grounds to the Canadians.
So far no politician has come forth with the truth about Maine's employement prospects. As a state we keep trying to patch together systems that will hold the line, but over the past 35 years, that "line" has gotten further and further behind the true cost of living for most people in this state.
Maine could assume a true leadership role in new construction and buidling materials, new high grade insulation products and new, high efficiency windows and doors, but there is little impetus to do so, as the politicians are only running for the NEXT election, rather than the welfare of the people who they dupe into voting for them, election after election.
For investment of capital I would find a different place to put money. I like real estate in Maine, but the only real estate that is really valuable for investment purposes is waterfront property, and that is so enormously expensive that the return on investment will be measured in decades, I fear.
As far as renovating houses and "flipping" them...if you mean in less than ten to fifteen years, I would pass, unless you find something so far below appraised value and so easy to fix quickly as to enable a strong post tax gain in the first year or two of ownership. That will be extremely hard to do.
The true cost of this recession is yet to be established, and my guess is that Maine will become a poorer state by far, and remain that way for years measured in decades.
Fantastic input with a great overview. Thanks for your thoughts! I agree with your overall assessment. It's going to be quite a while before we get out of the weeds, economically; and the recent federal spending spree will only ensure that the pain is prolonged. However, it seems that careful investment in real property has always been a solid investment. We will have to take a long-hard look at the local market before making any commitments. I think we will want to live and breath in the area for at least 6 to 9 months prior to making any buys.
Flipping is good in ANY market as long as you know what you are doing.
It is way more involved then just buying, fixiing up, and selling for more money.
You have to know your market!!
Great point, especially since we would be at somewhat of a disadvantage since we would be relocating to Maine. We would be heavily dependent on a good, local realtor. We'll try and be very careful at first!
I think we will want to live and breath in the area for at least 6 to 9 months prior to making any buys.
I absolutely agree with this plan. Patience and learning the territory will be your key to success.
Five years ago my wife and bought an antique grange store with historical significance. It was near derelict and we began a very ambitious restoration/renovation. We actually did use the first floor for a couple of years until my parents' declining health required that we spend most of our time in Belfast which was 65 miles away. We had an elderly tenant living on the second floor and he remained in the building until he passed away. Once he was gone, I began to completely renovate the 1500 square foot apartment and ready it for a new occupant.
This building is located in a prominent place in one of the "good" towns...we have been trying to lease or sell it for three years with limited success in showing it through four different realtors, and only recently have we found one who is actually trying to work the territory. The asking price is cheap and we have zero offers...although several people have said that they need to sell their property in _____________. (new Jersey, Connecticut, East Elephant Hoof....you fill in the blanks.) The bottom line is that there really is very, very little market.
In Morrill, outside of Belfast about ten miles is a nice, reasonably good condition farm house on seven acres or so that my daughter has had on the market for three plus years. Little activity, although she has had a tenant twice, neither of whom really worked out well: ie: paid the rent!....The house is for sale at a really cheap price for what it is, and the price is probably going to drop further so that my daughter can get on with her life in Virginia. If I were fifteen years younger I would buy THAT house on speculation, figureing that in about eight to ten years it will be worth ten or even fifteen grand at least more than she is asking for it, but I do not have the time nor interest to "speculate", and I know the territory.
In my opinion, there are a lot of opportunities for real estate investment right now and there will be more as the months pass while the recession works its kinks out. Patient capital, handled patiently will do very well. But hurried buy/sell, as the old days of buying and flipping won't work: yes, putting money and labor into a place might well get a small return, but the added punch of real property appreciation will take more on the order of a decade, I think.
Take your time and think hard about WHERE you are. Here's a hint: property on the coast or in the coastal towns will continue to appreciate as more and more "baby boomers" retire, and there are a lot of them who still have a little money set aside for this opportunity.
If you're selective and thoughtful, you can make money. Example: a two unit house on our street came up for sale two years ago, and we bought it. It is a one minute walk from our house, so the location made sense (we can keep an eye on it, etc.) We also got a good deal, as the owner had been diagnosed with cancer and needed to unload all his properties. We paid cash, so no mortgage. And we've done a few upgrades etc. so that it stays rented.
But I would not have just jumped in and bought any old property.
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