Home Buying in New York>Question Details

Dirk Diggler, Home Buyer in

What are some good neighborhoods to buy an apartment in NYC to rent out?

Asked by Dirk Diggler, Sun Apr 14, 2013

I want to buy an apartment, furnish it and rent it out. Looking for low vacancy rates and minimal management. i.e., collect rent, refer to repairmen etc..

Of course a Low sell price with maximum rental price would be nice too :)

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i have the answer to your question mail me on owen.hurley@hotmail.com
0 votes Thank Flag Link Sat Apr 20, 2013

I am sorry you had a negative experience with your realtors. I work with quite a few investors and since they continue to work with me over several years, I hope they are satisfied with their purchases and services I provide.

Depending on how you want to structure your purchase (how much do you want to finance), its absolutely possible to get positive cash flow on purchasing and leasing out a condo in NYC. Manhattan tends to yield lower cap rate (3% at the most) due to high monthly carrying costs but the occupancy rate at the end of 2012 was above 98% and provided your apartment is priced in line with the market, it will get rented. I also work in a few neighborhoods in northern Brooklyn, where the rental prices and occupancy rates are as high as Manhattan, but purchase prices and carrying costs are slightly lower, it gives 4%+ cap rate and I feel property appreciation in those neighborhoods over next 5-7 years will be higher than Manhattan.

Hope it helps. Feel free to contact me directly if you have more questions and you would like to work with me.

Masha Sales
37 Third Avenue NYC NY 10003
Mobile 917.658.3667 | Direct 646.398.6108 | EFax 917.262.7375
0 votes Thank Flag Link Thu Apr 18, 2013
Please give me a call and I would be happy to assist you. My name is Tanuja and I can be reached at 347-882-0353. Thank you and good luck.
0 votes Thank Flag Link Tue Apr 16, 2013
Dirk, you need to work with a buyer's agent. The seller's agent's fiduciary responsibility is to his seller. While an agent here in Manhattan can legally be a dual agent representing both buyer and seller, it's very difficult.
A quick search shows me that at your price point, the greatest number of condos are in Harlem and the Battery Park/Financial District areas. Very different neighborhoods at opposite ends of Manhattan.

How will you define a positive cash flow? For example, is it simply income vs. expenses? Or will you factor in depreciation allowance?

Call some of the people who have contacted you here. Just as I can usually know fairly quickly if I'm a good match for a potential client I talk to, you'll likely be able to figure that out as well. No agent is a good fit for all clients. If you want to chat, my cell is 310-951-8993. I moved here from California about 3 years ago and was licensed just over 2 years ago. Probably bring a bit of a different perspective than many agents.
0 votes Thank Flag Link Tue Apr 16, 2013
Thanks for your responses. My budget is around $600k. My intention is to rent out immediately after purchase so looking towards condos.

While the general appreciation of real estate is a great thing for me, I am looking to make positive cash flow on this deal.

I am hesitant to call a random NYC realtor in my yellow pages. During my home buying process on Long Island, I dealt with a lot of realtors when searching for homes and unfortunately most of them were not very honest. Even the realtor that we ended up buying the house from told a series of lies to move the process along which caused issues at the closing.

That said I would seek advice from a realtor that I feel like I can trust. I understand they are earning a living but I am a qualified buyer and need someone who looks out for my best interest as well.

While I would love to buy an apartment building and could probably pull together the money to afford it, I don't know if I'm experienced enough to sink everything I have into a building. Unless they are cheaper than I'm thinking...
0 votes Thank Flag Link Mon Apr 15, 2013
Depends on your budget, areas of interest to you, etc.; therefore consider working with an agent of your own, who can provide any necessary information....
0 votes Thank Flag Link Mon Apr 15, 2013
As others have pointed out, if your intent is to buy an apartment to rent out immediately, it has to be a condo rather than a co-op. I would also like to add that you are talking about furnishing it, which leads me to believe you are thinking about short-term rentals. Please be aware that most condos have a one-year minimum on sublets. Furthermore, the mayor has recently cracked down on short-term rentals as they cut into hotel business, so if you are thinking about a succession of short-term renters, that is problematic. You also say you are looking for "a low sell price with maximum rental price." Right now we are very much in a seller's market. Most properties right now are going for full ask price and above with multiple offers. The bargain days are now behind us. So, the second half, getting a good rent is likely but the first part not.
My advice would be to work with a skilled, experienced real estate agent. We can guide you every step of the way.

Jenet Levy
Halstead Property, LLC
212 381-4268
0 votes Thank Flag Link Mon Apr 15, 2013
Hard question to answer based on info provided. Are you looking for positive cash flow? Or is appreciation more important?
As you probably know, if you're buying in Manhattan, in most cases you're buying a co op which will almost always require that you live in it initially and then you can often only rent for 2 or 3 of 5 years. There are exceptions to this but they are rare.
So if you can afford it, find a small building that's already a total rental property. If not, find that co op exception or a condo.
0 votes Thank Flag Link Mon Apr 15, 2013
Hi Dirk,

Most likely bet is a condo for immediate ownership and ability to rent out without living in the unit first. However, there are also a handful of midtown , tudor city and kips bay coops which allow investors only which fetch excellent rent.

Is there a particular area of the city which interests you & is this a cash purchase/ 1031 exchange?

LMK how I can help further !

Executive Director of Townhouses
M: 646-418-4150
0 votes Thank Flag Link Mon Apr 15, 2013
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