Acquiring a property is not always the first that jumps to mind when someone says “invest.” We think stocks, open a Roth IRA, pump up the 401k, but there are other options.
The Syracuse market is full of opportunity, let’s break it down.
1- Interest Rates They’ve never been lower! Period. Exclamation! In the history of financing; lenders haven’t seen anything this low, ever. I remember just a few years go when people were getting rates as low as 5.25% and that was shocking. Now you can find them as low as 2.83% for a 15 year fixed rate. Fixed Rate! go when people were getting rates as low as 5.25% and that was shocking.
2- Cash Flow With the right criteria, you could LIVE FOR FREE! Take this real scenario: A 2 family house for sale in Mattydale, CNS Schools listed at $119,000. The tenant paid $900/month for 3 beds & 2 baths and driveway parking, a landlord may be able to get more per month. 3 beds + 2 full baths is not easy to come by in a two family, plus it was in a preferred school district, so let’s say the rent is $1,000. A first time home buyer with an FHA loan would pay approximately $14,000 for a year of taxes, closing costs & down payment, with a monthly of about $1,100/month. What is even better is an FHA buyer can roll in some of that $14,000 to off set their upfront closing costs, and it would be reflected in the monthly payment. But the bottom line is, you could be living here and only paying about $100 per month. If an investor scooped this up, collecting $2,000+/month, PLUS they can write off the interest. There are deals like this all over Onondaga County, be ready to make an offer if the numbers work.
3- Variety When people think of “rental property” in Syracuse, they think: Syracuse University Neighborhood. The truth is there are multifamily properties that sell for as little as $15,000 for two units up to $1.7 Million for 76 units. There are properties for sale with conditions, neighborhoods and price ranges for any investor’s palate. The Syracuse University rental market is dominated by investors that acquire many of their properties quickly & for cash. They tend to hold the properties for a long time, and have a very high turn over rate with students coming in and out. And condition can vary, but often the feedback I get from owner occupant investors is disappointment in the quality for your dollar. There are other areas of the city that get pretty good rental amounts besides the Syracuse University. Try Tipperary Hill, Eastwood, around the LeMoyne College area and downtown Syracuse. Downtown Syracuse has experienced some major residential growth in the past few years, and there is more to come, I predict.
4- Shortage of Rentals It’s no secret our economy is suffering, and according to market forecasts home ownership will drop 1-2 percentage points, as we recover. Plus, “the single-
family rental market, a growing and distinct market from multifamily, has expanded 16% (about 3 million units) since 2007.” No matter how far we advance in technology there are some things we will always have a need for: hairdressers, dental hygienists, plumbing and of course: homes for rent. For every house, apartment, condominium, and townhouse that goes up for rent, there just aren’t enough to fulfill the waiting list of qualified renters that want to move in. It’s just a fact that “FOR RENT” are two words that will not linger on as long as “FOR SALE” will on a property. In 2005, at the height of the real estate market, renters were buying homes* and according to Freddie Mac, the number of renters is on the rise. (*Freddie Mac refers to “non multifamily housing” as 1-4 units)
5- Lower Prices Syracuse has phenomenal prices on property for sale. That is a big factor as to why we work with so many out of town investors. According to the NYS MLS over the past 12 months our average sale price is $76,600, our median was $59,900, meanwhile the rest of the country sold had a median price of$128,600.
It’s a win-win for investors in Syracuse. With low rates, variety in choice and the demand for rental property, it’s an obvious return on investment. Plus, interest is still tax deducible in New York State.
For more information the Syracuse Real Estate Market, contact MICHELENASTRI@KW.COM. Your Syracuse Keller Williams Real Estate Resource.
Fit-Girl Foodie 