BUYING MULTI FAMILY
Buying a Home, Coop, or Condo in Queens is much different than buying a house in other parts of the country. One thing in particular that you will find a lot of in Queens, are multi-family properties, specifically 1, 2, and 3 family homes. Multi family homes can be a great financial investment because of the rent rates, appreciation, cash flow, etc. With that said, below are some of our top items to look for when buying a multi family property in Queens…
1. Number of Boilers – When shopping for a 1-3 family home, you definitely want to know how many boilers the property have because that will determine your monthly heating expense. Ideally, you would want a property that has separate meters for each unit, that way renters will be responsible for paying their own heating bills. If you pursue a property with only one boiler, you will be stuck paying the entire heating bill for the building, or you will need to have it converted to separate them.
2. Age of Boiler(s) – Along with knowing how many boilers are in the property, you also want to know the age of them because if they’re very old, you will most likely need to replace them soon. Boilers can be very expensive so you either want a discount for old boilers, or ideally, purchase a property with fairly new ones.
3. Number of Electric Meters – Same as with boilers, you want to know how many electric meters are in the property because if there are separate meters, your tenant(s) will be responsible for paying their own electric bill. However, if there is only one electric meter, your monthly expenses will be increased because you’ll be stuck with the entire electric bill, or you’ll need to have it converted to separate them.
4. Age of Roof – Roof replacements can be one of the most expensive home improvements so you definitely want to know how old the roof is when your house hunting for a multi family in Queens. If there is an existing warranty on the roof, you also want to request that it be transferred to you in case anything happens. Ideally you want a fairly new roof, but if it is at the end of it’s life span, just make sure the discount is reflected into the price.
5. Rent Rates – Make sure that you know what current rent rates in the area. Your rental income will be the revenue for the property, so the more accurately you can project rent rates, the more accurate your investment calculations will be. A good buyer specialist will know rent rates for several different neighborhoods around Queens.
6. Parking Spaces/Garages – Parking spaces lead to the opportunity for more income because each space can be rented out as well. So, when buying a 1-3 family home in Queens, you want to make sure that you’re factoring in the potential income from parking spaces and garages.
7. Proximity to Train – When buying a hold property in Queens, it’s all about transportation. So, if you are within at least half a mile from a train station, you will significantly decrease your vacancy rates. Properties close to the train rent quicker because the demand is always there, on the flip side, if you purchase a property further out from the train, you will experience slightly longer vacancy rates.
8. Cash Flow – Cash flow is king. Make sure that your property cash flows from the beginning so that you don’t have to come out of pocket in the future. Your monthly rental income should pay for all your monthly expenses (including mortgage principal, interest, taxes, insurance, utilities, etc) and leave you with a surplus at the end of each month. If you don’t cash flow at least one dollar, then your maximum offer should change.