I’ve been investing in New York real estate for years and frequently chat with other seasoned investors about which up and coming New York City neighborhoods to invest in next. I’d heard there are several great investment properties in Long Island, for example, where some of my colleagues have done quite well. But recently, I started looking outside the big city for areas that might hold as much, or more, promise for buying, renovating, and selling houses–areas that might not be on every investor’s radar just yet. Ultimately, I landed on flipping houses in Rochester, New York. I think it’s another great place to invest in and it’s certainly the right time. I’d like to tell you why you might want to invest in Rochester too.
The Market for Flipping Houses in Rochester, NY
The housing market in Rochester has been on the road to recovery, much like the rest of the country, since the housing crisis but at a much slower clip. While its recovery hasn’t kept up with other parts of New York, particularly the New York City boroughs of Manhattan and Brooklyn, median home sale prices are headed in the right direction. They rose 4% to $130,000, according to the Greater Rochester Association of Realtors (GRAR). In terms of hard numbers, the increase isn’t a huge jump compared to some markets, but it’s still significant since it suggests a growing demand for housing in the area.
In correlation, inventory is also on the decline in Rochester. GRAR reports that inventory decreased by 12.4% from the previous year. New listings, specifically, dropped by 7.7%. There could be a number of factors contributing to the reduction of inventory in the area, including the limited amount of new construction. But, it’s equally likely that some homeowners don’t yet have enough equity in their homes to sell if they bought during the peak of the housing bubble. Because appreciation has been slow in Rochester since the housing crash, homeowners who may be underwater or struggling to make mortgage payments could be waiting to sell until they can really come out ahead. Also, whereas Baby Boomers use to downsize once the kids left home, this generation seems to be staying right where they are–at least, for now.
But, the demand for housing in Rochester remains relatively strong in spite of the inventory squeeze. Even with fewer new listings, lower overall inventory, and rising home prices, sales only stalled by 3% when compared to the previous year, according to the GRAR. And, notably, home sellers got 95.2% of their asking price. In a nutshell, homebuyers are willing to pay the price to live there. Additionally, with more first-time buyers seeking starter homes in growing markets that are still affordable, it’s reasonable to expect the interest of homebuyers from outside Monroe County to get even stronger–especially with a median home sales price far below other major metropolitan cities in the region. This could make flipping houses a good business to be in for investors looking at Rochester’s market as an option over New York City.
Rochester has other things going for it as well. Wages are increasing and unemployment has hovered at or below 5% in the last year, according to the Bureau of Labor Statistics. Rochester also has lower than average crime rates, with some neighborhoods–like Browncroft, North Greece, and Chili–ranked safer than most in the nation by U.S. News & World Report. So, homebuyers who want their funds to stretch further and still live in a safe area with a strong economy may look to Rochester as a smart choice for buying a house and raising a family.
However, with interest rates finally going up and property tax deductions getting cut starting this year, the pressure on homeowners already under financial duress is bound to increase. When push comes to shove, these homeowners may be forced to sell–and fast–to avoid an additional hardship like going through a foreclosure. For real estate investors, this means that opportunities to purchase and rehab discounted properties from distressed homeowners and realize a decent ROI could increase.
But, is there an easy way to identify these upcoming opportunities for buying, renovating, and selling houses in Rochester? There is if you have a marketing strategy that finds motivated sellers who may not be able to afford the upkeep on their home, higher tax burdens, or their mortgage payments due to financial stress.
Marketing to Distressed Homeowners in Rochester, NY
Investing in the Rochester market wasn’t difficult for me to do because I was able to leverage investor marketing tools that generate local leads on motivated sellers. Since becoming an independently owned and operated HomeVestors® franchisee, I’ve benefited from the nationally-recognized “We Buy Ugly Houses®” advertising campaign that reaches distressed homeowners throughout New York state, including Rochester. And, as a result, I’ve done well compared to other real estate investors who stayed focused only on New York City.
If you need a marketing strategy that reaches distressed homeowners, you can’t afford to miss the opportunity to learn about HomeVestors® franchising. Contact the “We Buy Ugly Houses®” team for more information today!
Each franchise office is independently owned and operated.