The temperatures may be falling but the real estate climate around Park Ave is super hot, especially for multi-family investment property. In the past six weeks or more, I've heard from many investors and want-to-be investors and when we secure an appointment to view these properties, there are usually two or more other investors looking at the same time.
A little free advice here for new and want-to-be investors. There are three primary ways to loose money on your investment.
The first is financing. I meet many investors that want to buy the property as a primary residence simply so they can put a minimum down and mortgage the property to the hilt. With interest rates so low that is tempting to do but all interest is front loaded, and so this strategy will only work if the investor is committed to a long term investment.
Next comes maintenance. Even if you purchase a property in perfect condition, tenants cause wear and tear. If you can't tell a hammer from a screw-driver and the thought of getting on a ladder breaks you out in a sweat, you will need to hire someone to take care of your property. So that is profit out of your pocket and into someone else's.
The last biggie is managing your property. You will only make money if you screen and select good tenants and then collect the rent. Some investors hire that job out and as a result a good chunk of their income is given a way.
The bottom line, is that there is a lot more work to being an investor than depositing rent checks. If you need to mortgage the property, hire a handy man plus a property manager, make pretty darn sure that the return on the investment is great enough to cover these expenses.