Real Estate investors looking for cash flow and appreciation are narrowing in on Massachusetts to build rental portfolios. The Bay State is a current favorite of real estate investors due to many factors including a strong and stable economy, a growing and highly education population with a healthy demand for housing! Easy Street Capital is proud to be a leading provider of investment property loans for real estate investors looking to build rental portfolios in Massachusetts!
Loan Types for Massachusetts Real Estate Investors
When it comes to real estate investing in Massachusetts, there are many markets and types of investment property loans to choose from. Massachusetts has a lot of older properties with great bones, but in need of renovators to restore them to their former glory. For investors adept at rehabbing older properties, hard money renovation loans are a perfect choice! These loans allow you to buy a property quickly and finance your rehab costs as well! Once you are done, you can either “flip” the property for a quick profit or pursue the BRRRR Strategy by renting it out and then refinancing into a long-term, low-rate DSCR loan!
Long-term DSCR Loans are also great for investing in turnkey rental properties. Turnkey refers to properties that are rent-ready and require no renovations. Move-in ready single family homes and fully furnished short term or medium term rentals are great for cash flow and price appreciation. Most DSCR Loans are fixed rate for thirty years, locking you into a fixed interest rate for the long-term. While, if historical patterns continue, rents and appreciation increase steadily each year. Bottom line, debt costs stay the same while cash flow increases!
Massachusetts: Landlord-Friendly State
Many investors might assume that Massachusetts, with its liberal bent, may not be landlord-friendly. But it is actually a landlord-friendly state. Owners of rental properties, such as typical DSCR Loan borrower, are secure investing in the state. Unlike some other states, Massachusetts does not have any form of rent control. This means rental property owners are free to set rents at whatever level the market will bear. This can be an advantage for landlords who are looking to maximize their profits. In addition, if a tenant fails to pay rent or violates the terms of their lease, Massachusetts landlords can begin the eviction process relatively quickly. For example, landlords can serve a tenant with a “14-day notice to quit” if they fail to pay rent. After just two weeks, the landlord can file a complaint for eviction in court.
Where To Invest In Real Estate In Massachusetts
Massachusetts is a favorite market for real estate investors because of its diverse options. There are lots of varying markets that offer great potential for each type of real estate investor. Boston is the states largest city and capital and is the cultural and financial center of New England. Worcester, located approximately 40 miles west of Boston, is the second largest city in the state. It is also a growing market with affordable options for investors. Cambridge is a strong secondary market with a population of approximately and home to world-class universities. Springfield is the third largest city in the state and the heart of the Connecticut River Valley. Quincy is a historic coastal city with both a strong permanent population of long-term renters and demand drivers for short term rentals.
Boston
Boston is the largest city in Massachusetts, with a population of over 700,000 people. The greater Boston metropolitan statistical area has a population of approximately 4.8 million, the tenth largest in the United States. The city has a diverse and thriving economy with a strong focus on finance, education, and healthcare. It is home to several Fortune 500 companies, including Liberty Mutual, State Street Corporation, and General Electric. These major companies provide a solid employment base for renters. The city and surrounding area is also home to many universities. These attract a large number of students and young professionals who need rental properties.
Boston’s strong economy and diverse population make it an attractive market for real estate investors. The city’s growing job market and population growth create a steady demand for rental properties, with opportunities for long-term leases, medium-term rentals, and short-term rentals. The tourism industry is also thriving in Boston, with top attractions such as the Freedom Trail, the Boston Common, and the Boston Tea Party Ships & Museum. The city’s rich history, vibrant culture, and sports teams such as the Boston Red Sox, Boston Celtics, and New England Patriots make it a popular destination for visitors. This provides a robust market for short-term rentals.
Overall, Boston’s strong economy and diverse attractions make it a great market for real estate investors looking to invest in single-family and multifamily properties.
Worcester
Worcester is located in central Massachusetts with a population of over 185,000, making it the second-largest city in the state. The city has a diversified economy, with industries such as healthcare, manufacturing, and education playing key roles.
Real estate investors can find affordable investment opportunities in Worcester, with the median sales price for a single-family home in February 2024 at $416,000, according to Redfin. In addition, Zillow reports that the average market rent in Worcester in March 2024 was $2.000 per month, making it a lucrative market for rental properties. Investors using rental loans can take advantage of low down payment options and earn substantial cash flow with potentially high cash-on-cash returns.
Worcester also has several cultural attractions, such as the Worcester Art Museum and the Hanover Theatre for the Performing Arts. The city’s location in central Massachusetts also makes it a desirable destination for tourists throughout the year. This provides a robust market for short-term rentals, especially during peak tourism seasons.
Overall, Worcester’s diverse economy and attractive cultural attractions make it a great market for real estate investors looking to purchase investment properties. Investors can capitalize on this growing market and achieve strong returns on their investments.
Cambridge
Cambridge, Massachusetts is home to Harvard University, a world-renowned research institution with a student population of over 23,000. In addition, it hosts the Massachusetts Institute of Technology (MIT), another elite university with enrollment of nearly 12,000.
The city is also known for its vibrant arts and culture scene, including numerous museums, galleries, and theaters. With a population of over 118,000 residents, Cambridge is a diverse and thriving city just outside of Boston. Cambridge is an ideal market for real estate investors specializing in student housing. The large student population creates a consistent demand for rental properties near the university. Investors who focus on well-located properties and rent to reliable students can earn higher returns than with traditional long-term rentals.
Moreover, Cambridge is a popular destination for short-term rental investors. The city hosts a number of events throughout the year, such as the Cambridge Arts Festival, the Head of the Charles Regatta, and the Cambridge Science Festival. Additionally, the city’s many notable historic buildings and attractions draw in lots of tourists. These attractions, coupled with multiple great museums and art galleries provide a great opportunity for investors to capitalize on short-term rental demand and earn higher rental income.
Springfield
Springfield, Massachusetts is a growing city in western Massachusetts with a population of over 150,000. The city has a diverse economy, with industries such as healthcare, education, and manufacturing playing key roles. Springfield is also home to many cultural attractions. These include the Basketball Hall of Fame and the Dr. Seuss National Memorial Sculpture Garden. Its vibrant downtown area has many shops and restaurants that attract both residents and visitors.
Real estate investors can take advantage of both long-term and short-term rental demand in Springfield. The city hosts big events such as the HoopHall Classic basketball tournament and the Big E agricultural fair. These bring in visitors and provide a great opportunity for short-term rental income. With its proximity to Boston and New York City, Springfield offers a prime opportunity for investors looking to get in on a growing market.
Quincy
Located in the Greater Boston area, Quincy is a picturesque city known for its rich history and breathtaking waterfront views. Its downtown area features a thriving arts and cultural scene, with museums, galleries, and theaters. Quincy is also a popular destination for outdoor enthusiasts, with activities such as boating, fishing, and hiking in the nearby Blue Hills Reservation.
The unique combination of culture, natural beauty, and outdoor recreation makes Quincy an attractive location for short-term rental investors. Visitors come from neighboring cities, such as Boston and Cambridge, for weekend getaways and longer vacations. Rental rates remain consistent throughout the year, with peak seasons during the summer months. Additionally, the city hosts various events, including the Quincy Arts Festival and the Celebrate Quincy Festival, which bring in even more visitors and potential rental income.
Investing in real estate in Quincy presents a lucrative opportunity, as evidenced by recent market trends. According to Redfin, the demand for homes in Quincy is high, with many properties receiving multiple offers and some buyers even waiving contingencies to secure their desired homes. The average sale price hovers around the list price, indicating a competitive yet balanced market. Homes in Quincy also tend to go pending swiftly, typically within 23 days of listing. One particularly enticing metric for investors is the sale-to-list price ratio, which stands at an impressive 100.5%. This suggests that sellers are often achieving prices above their initial asking prices, a promising sign for potential returns on investment. In February 2024, the median sale price for a home in Quincy reached $560,000. For real estate investors seeking opportunities in a dynamic and rewarding market, Quincy presents a compelling case with its strong demand, quick sales, and attractive housing market.
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Ready to invest in real estate in Massachusetts? Easy Street Capital is top lender for rental loans in Massachusetts, both hard money rehabs and long-term rental properties.
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