Rochester and Buffalo

**Norcalkid** · 11-24-2008, 11:09 AM

Hi, I am just curious. I keep seeing adds for houses and duplexes for sale in Western NY(mostly Rochester and Buffalo). They are cheap and offer positive cash flow. My guess is that there will be virtually no appreciation. So people are just buying them for cash flow. It is my assumption that they are not in great areas. Most of them have section 8 tenants in them.
Anyway does anyone on here have any experience with these properties? Just wondering what your experiences have been with them. Are there actually any out of state investors that own some of them and make money? Or does the age of the properties, poor tenants, and vacancy eat up all profits.
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**jamesww** · 11-25-2008, 03:03 PM

I spent some time in upstate New York and realized that the trouble there is that you have a declining population and so both rents and property values have been stagnant for some time. Recently both Buffalo and Rochester had been seeing decent apprecitation but the mess we are in now has caused them to turn back in the other direction.

There are other parts of the country that have better chances for apprecitation and have plenty of chances for taking a positive cash flow on rental income. Until the upstate New York's population starts growing again I would stay away from investing in property there.

The majority of Texas provides a better option than do either Buffalo or Rochester. I feel that Houston, Texas or Dallas, Texas are the best bets in the country as both of those cities have property values below historical numbers when using the median home sale price and the median income for analysis. I am not nearly as knowledgable on the Dallas market but can find yo someone who is if you would like. Of course I feel that Houston will be the best real estate market in the country for the next 5 years at minimium.

Let me know if you would like anymore information.

**Norcalkid** · 12-06-2008, 01:08 PM

[FONT=Times New Roman][SIZE=3]Thanks for the reply. Sorry it took me so long to get bock to all of you. I figured there must be something like that going on there. I actually have been looking in Texas. My parents have 5 or 6 rentals there (El Paso). They do well but the one thing we have found to be hard about Texas is the taxes. They are around 3%. So some properties that look like they will make pos. cash floe actually don

**jamesww** · 12-08-2008, 12:23 PM

I can totally understand how you feel about the taxes as they can sting. One thing that needs to be noted on that issue is part of the taxes pays a significant amount of the water and sewer. Also you need to know each areas tax rate. In the Houston area it can range from 2.4-4.2%. The best rentals when it comes to profitability are found in Deer Park and Pasedena. They have fairly low tax rates, lower cost of accusition, and some of the highest rents. A foreclosure purchased in Deer Park can cash flow very nicely and will never be empty.