Meg

Hello Fairhavenest,
I recently moved to the Buffalo, NY area from Alaska with the idea of seriously getting involved with real estate investing. So just like you - I was asking this question 5 months ago. I did a college research paper on it, packed up my bags and am putting it to practical application. I have been 'doing time' in the area with my real estate agent for a month now.
So - to answer your questions:
Back in the 1900-1950s Buffalo/Niagara were a booming industrial area. Grain, Shipping, Steel. They were state of the art convenient shipping location being located next to the great lakes and then with the addition of a major rail line they thought they were unstoppable. Buffalos' (you'll have to take some similar assumption of Niagara as I've been focused on the Buffalo area) population boomed to over a million people within city limits alone. Many great political figures, inventors, architects, and artist wanted to be in this happening place. Then, as it did all across america but very specifically hit the great lakes industrial nation, the great industrial area ended. Unions begin demanding higher cost wages that assisted in sending jobs oversee, we are now in the technology generation and have left the industrial era behind... hence leaving Buffalo/Niagara/Detroit,etc behind.
The previous generations were (and are) very hard working people, but they came from good paying blue collared work forces. From what I've seen there has never been a huge emphasis on education in this area (although they are starting to change that). With the industrial jobs gone, it left a lot of people who used to have good paying jobs finding themselves jobless and in poverty without the set of skills they needed for similarly paying jobs. A lot of those who could get out did, dropping the 1 million population down to 5-600k. You can imagin that leaves a lot of open housing!
So the story as to why the cheap real estate:
There's more homes then bodies that want to live in them. With that and one of the highest poverty rating in the nation, a lot of homes have been forclosed and/or abandoned. Majority of construction area here occured in the 1880s-1940s, so a lot of older homes and the majority of them have not been kept up.
I look at approximately 200 listings on line each week, physically go and see about 10 a week, and find about 1 a week that I, myself, would consider living in. I have to admit it, but Joe is right. The subburbs are better kept, newer construction, and still at reasonable prices and there are no incentatives to take the time/money to fix up the older homes so a lot of the communities inside the cities have become crime infested. The governer recently announced that he was going to put millions into urban renewal, but the programs are not yet out there to apply to unless you organize a not-for-profit group. The Mayor of Buffalo is taking good steps to clean up areas and to work with partnerships for improvements of certain districts (you have to start somewhere focused!).
So yes. Yes to all your questions. Crime is an issue. Some will tell you that no work is an issue, but I personally have had no problems in that area so I'm not sure what they're talking about (industrial jobs are gone, but there's plenty banks, collections, medical, transportation, real estate/prop management, service, entertainment - I guess it depends on what you're looking for). 'What" - old homes, mostly not well maintained.
So why bother? These towns have amazing history and architecture and there is so much increadible potential and the cost of living is extremely reasonable.
There ARE amazing homes out there at increadible affordable prices - you just have to do your homework before you buy.
My story thus far: I'm looking at purchasing 5 buildings in the next 11 months. My 'day job' that I'm keeping in the mean time is paying me better then my previous one. I own a 2 bd/1 ba condo at 625 sq up in the Alaska, here I'm looking at a 6 bdr/3 bath, jacuzzi tub, swimming pool, 3 car garage, hardwood floors for the same price. Am I happy I came here / was it worth it... YES! - Mon Feb 4 2008, 12:18