Worcester Multi-Family Real Estate Blog

I'm sure that this has happened to you before. You go out to dinner with a group and either you are sharing the bill, or maybe the boss or someone's parents are paying. You can order whatever you want!!! What do you order? Options for Dinner A. The "Rib Eye" or the most expensive thing on the menu, and maybe a couple appetizers B. The best value on the menu, perhaps the special. One of the reasons that people hate REAL ESTATE AGENTS is that they feel that they are always "BUY

This is an interesting graphic I found the other day. If you look closely it shows that Median Household income is Low $48k and Average income is also pretty low for MA at $68k. The key here is that Median income for Married Families is $84k and Average income for Married families is $102k. What does this tell us? And how does that impact our thoughts on Multi-Family investing? Income Insights First off if we take 30% of $48k these households are able to afford around $1200 a

There is word on the street that there has been an increase in LUXURY HOUSING in Worcester, but not enough to increase the amount of AFFORDABLE HOUSING in Worcester. Defining Luxury Housing in Worcester This is a city where most of the multi-family housing was built between 1890 and 1930. There are few buildings that contain more than 6 units. Characteristics of Luxury Housing Okay, here we go with LUXURY. The features that define luxury housing in Worcester include: Level

Interesting article here about the FED and how Government debt is an issue in stopping inflation. Source Key Points Almost 20% of all US Dollars were created in 2020! This is from stimulus and various other government programs. Inflation is not just a general rise in prices, but an increased supply of money, which in turn sets in motion a general increase in the prices of goods and services. SO IS THERE ANY SURPRISE THAT INFLATION IS NOW AN ISSUE? Prices are up, so people are

Realtor.com is saying that Worcester is the 9th Hottest real estate market in the US? What does that mean? Here is an article discussing Worcester: Spectrum News Article Here is the underlying Realtor.com article: Realtor.com Article Key Insights "Our top housing markets are attracting remote-minded workers, possibly interested in snagging a big-city salary while still enjoying the quality of life that these generally smaller areas afford," says Realtor.com Chief Economist Da

On Tuesday night, the Worcester City Council had their annual tax rate hearing. See Article from the T&G You can see my personal thoughts on the topic in my testimony at that City Council Meeting starting at 14:20 - 17:50 of this attached video. Alex Guardiola, VP of Government Affairs for the Worcester Chamber, speaks after me. See article Commendation for City Councilors I would like to commend those City Councilors who voted to make the taxes more equitable between busines

Interesting article here in Fortune Magazine. It predicts that there is a 50-75% chance that prices in Worcester will decline in the next 12 months. Read the full article here. What does that mean to Multi-Family investing? First off let's establish that: Types of Multi-Family Properties 2 families for the most part are single family alternatives, basically a mortgage helper. 3 families have more of an investment feel and work for small investors, as well as certain 3s with b

The multifamily market in Worcester is still HOT. Currently on the MLS there are 36 Multis for sale, which is the lowest on-market number in the last 4 years. Market Breakdown Here is the breakdown: 11 - 2 families 20 - 3 Families 2 - 4 families 3 - 5+ On top of that, there are a couple of those that are under contract that are not reported that I know about. And of those on the market, many are just not going to sell at those prices, so those should be taken out of the equat

Every day we are seeing articles about INFLATION and that inflation is a self-fulfilling prophecy. That is, if we think that there will be increases in prices, then we will make buying decisions based on that, and it will drive up prices. Pretty simple process. Inflation is based on CPI (Consumer Price Index) which puts together a basket of goods and services that typical Americans use and compares them to prior periods in time. Core CPI goes one step further and EXCLUDES foo

Sunday November 7, 2021 article by former mayor Ray Mariano Read the full article here Quick synopsis here. People used to not want any part of Main South, but now they do. Projects are coming into Worcester and developing this section of the city. Key Points What is not mentioned anywhere in the article is that this is one of the few sections of the city with any amount of multifamily housing that is relatively FLAT. Reflection The transformation is real; it is just a shame

A survey of over 1500 American homeowners aged 60-75 from American Advisors Group says that 82% of survey respondents said they would prefer to live out their remaining years in their current home if they can. How does that impact the Worcester multifamily housing market? First, we would need to know how many of these properties are owned by people living in them. I would say that the number is slim. However, this does impact multifamily if buyers who would prefer to live in

This is a repost of an email I sent to my Clients on 7/19/2021 and additional 11/3/2021 comments at the bottom. On Mon, Jul 19, 2021 at 9:07 AM Brian Allen wrote: I believe Worcester has hit a high water point for CERTAIN TYPES OF MULTIFAMILY. Let's look at the numbers. About 6 weeks ago, everything was flying high, there were about 40 multis on the market at a time and a bunch were coming on and clearing each week. Almost overnight that number has jumped to 60 multis on the

Massachusetts is considering allowing tenants the right of first refusal to purchase the properties in which they live. The proposed bill would allow those tenants up to 6 months to purchase the home when the owner decides to sell. This article talks about how DC, which had a similar program, has run into problems and why Massachusetts landlords oppose it. Mass Landlords It is a terrible idea to take the ability to sell to whom they want away from an owner of a property. This

I had a buyer tell me that they didn't want to buy a multifamily for an investment, but rather buy a condo. With a condo, you pay fees to take care of everything outside, have a lower insurance cost, and lower taxes. All you have to do is make sure that your unit is ready to go and collect your little slice of rent. Example Investment Calculation Consider a $150k condo. Here is your math: Down payment (25%): $37,500 Closing costs: $2,500 +/- Out of pocket cost: $40,000 Monthl

Many investors come to me and they are all about CASH FLOW! Cash flow is great, but it is not the be all and end all of real estate. Real Estate is About Leveraged Appreciation If you buy a great property in a great location at retail price, you will win over time. You don't always win with cash flow. Often you see a property with $6300 a month in rent and a $600k price tag. Buyer beware. If the property was so great, why are they selling it? How are they going to get better

I get questions every day from investors who want to use the BRRRR method, basically, Buy Rehab Rent and Repeat. This is great in theory, if you have the ability to do the Rehab work. What is actually easier is to raise the rents than to rehab the units. Say you buy a house that is a dump and you get a discount for the condition. You now have to: Move people out, which may have a cost ($5-10k per unit) Have vacant units which don't produce income while fixing (loss of $1500/m

This is a reprint from 5.13.2019 to show that nothing has changed in Worcester. So this BULL MARKET for MULTIS has been going on for at least 2.5 years. All the advice is the same. Buying a Multi in Worcester in the Current Environment 5.13.2019 Many people are saying they are having difficulty purchasing a Multi-Family home in Worcester from the MLS. Here is the problem: Types of Buyers First off there are 5 different types of buyers: FHA 3% down who need the rents to be hig

As agents, we always run into issues of compensation when doing off-market transactions. Sellers believe they are getting the best deal when they get a certain price for their sale. Basically, they want $500k for the house. It is their expectation that the buyer will pay the commissions to their agent outside of the transaction. Many times this is the case, but when there is an agent involved, it doesn't work out as well for the seller as they think. Understanding the Role of

Yesterday's T&G had an open letter from Alex Guardiola to the City Council asking them to abolish the dual tax rate and I can't agree more. In the 30+ years I have spent in the city, I see what it is doing to the long-term prospects of businesses and their incentives. Here is the article: Read the article This provides me an opportunity to repost an email I sent to my buyers on 4.2.2021 just 5 months ago. This is a huge deal and it is important for investors to realize what i

I am often questioned by potential clients as to why they should work with a Buyer's Agent. Reasons to Work with a Buyer's Agent Here are 3 reasons why: They represent your interests. The whole point of a buyer's agent is to advocate for the buyer. Prior to buyer agency, everyone worked for the seller. There was the Seller's agent, and others were sub-agents to the seller's agent. With buyer agency, you have someone who is actively working on your behalf. There is no addition