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Rochester Area Guide

Why invest in Rochester buy to let property?

Rochester, New York is a city on the up, and is coming out the recession. The city, on the shores of Lake Ontario, in upstate New York, was recently been named by Forbes Magazine as number 1 in US jobs market, with the University of being the biggest employer, and city boasts one of the top four medical schools in the US. There is high demand for rental property and now is the time to buy, prices are increasing and the rate of neighbourhood gentrification is unprecedented.

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Prices from just $32,000

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Up to 18% NET yields

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Rising market

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Moodys A+ credit rating

Local economy

Xerox is one of the biggest employers. Kodak, while no longer making as much film or as many cameras as they used to are leading the way in innovative technology for the mobile phone and tablet industry, making them a big techie draw for the city.

Billionaire entrepreneur Elon Musk has invested in the world’s biggest solar panel factory, Solar City in South Rochester, and there is a notable uptake in millennials moving to Rochester. Housing is cheap and plentiful, and the jobs market is very strong.

Investment Opportunities

Now is the time to invest in Rochester; debt levels are low and the majority of investors are buying with cash. We have a relatively short time to invest in this area as the economy improves and prices start to rise.

The real estate market is picking up as loans become more readily available and institutional and larger investors are “discovering” the high net yields available. They will soon start to bulk purchase, pushing prices up and net yields down.

House Prices

We have access to a good range of fully refurbished, tenanted and managed three bedroom houses from $37,5000.00 to $70,000.00 per property (approx. £25,000 to £50,000) with typical NET yields of 17% on rental income. These prices are for refurbished properties and are lower than the local average price. They offer fantastic investment opportunities.

The Rental Market and Tenant Retention

The foreclosure rate is amongst the lowest in the US, and the percentage of the population renting rather than buying their homes is very high. Retention levels are high as good rental properties are increasingly in demand.

Buy-to-let Mortgage Opportunities

PCG Invest is working with B2R Finance, part of the Blackstone (BX) group, to give its overseas clients access to $300,000 mortgages to invest in high net yield USA buy-to-let income producing properties.

The loans of $300,000 are on a fixed rate 5.5% for 5-10 years on a 30-year term, with the borrower investing $100,000 (approx. £65,000*) of their own money.

PCG Invest’s Rochester Partners

Our partners have years of experience in buying foreclosed and empty properties, and only buy properties that they can then refurbish to the highest standards. They ensure that all back taxes are paid, all city building regulations are complied with, titles are clean and all leins are clear. They work closely with local authorities to ensure that every refurbishment is up to grade before the tenants move in. We are impressed with their track-record and are excited about the quality of the properties they have introduced us to.

What is the Purchasing Criteria?

The focus is on two main factors when looking for properties within the region and yield bracket when choosing for investors.

  1. Stable income. This means can this house be rented with zero/close to zero void periods for the near future? Factors that influence this are:

– Kerb appeal

– Quality of surrounding neighbourhood

– Tenant Demand

– Large employers nearby

– Quality of property

  1. Gentrification potential. Every city has one or more areas in some stage of the gentrification process. For landlords this means both faster capital growth potential and an improving quality of tenant.

Signs to look out for are usually quite obvious:

– New cafés/restaurants

– Bookshops

– Art galleries

– ‘Hipster’ businesses such as organic/vegetarian food/craft/galleries/spaces

If Starbucks has opened, you’re too late.

Typical Maintenance Costs

Factor in 1/3 of gross rent for all taxes, trash collection, maintenance, water, lawns, and property management. With a well-maintained single unit and long-term tenants, maintenance costs are likely to be little beyond the odd leaky tap and likely very low (under 5%) of the gross rent.

Why Our Rochester Partner works with PCG Invest

“They are knowledgeable and experienced with assisting clients to go through the overseas purchasing process. PCG Invest work in a streamlined and efficient way and make the process as smooth as possible. They can ensure you will complete the entire purchase in a timely and efficient manner while taking care of all the compliances and legalities. They are a true necessity to both first time and experienced landlords when buying overseas”.

See our latest Rochester investments

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