Are you looking to invest in NYC rental properties? Looking for resources to help you get started with a real estate investment in New York City?
New York City offers tremendous potential when it comes to real estate investments. While the cost of entry to the New York City real estate market can be prohibitively high for some, the long-term return on investment can be outstanding for many neighborhoods.
Real estate investments in New York City can allow you to enjoy monthly passive income and grow your long-term wealth. However, you need to make the right moves for this dream to realize.
In this article, we'll give an overview of the top neighborhoods you should consider for New York real estate investments. You’ll learn about the key stats and background information to get a better feel for the market.
Investing in New York City Boroughs
Queens is one of the top housing markets in New York City. The median resale prices have recently been on the rise, thereby sending solid signals of what may lie ahead in terms of potential return for investors.
Some investors debate whether it's better to invest in Manhattan or Queens. When you're looking to expand your portfolio, Queens makes sense in a number of ways.
For example, you can purchase three Queens rental properties for the price of one Manhattan property, on average.
The annual gross yield may be better in Queens than in Manhattan. The average rate of return has been hovering around 3% in Manhattan, whereas Queens shows the same indicator at about 6%.
The steady rent spikes in Manhattan and Brooklyn haven’t reached the borough of Staten Island to the same extent. This area commands a median rental price of around $2,150 per month.
Staten Island is likely going to see a significant increase in renter interest in the coming years. As Brooklyn and Manhattan experience sky-high rental prices, people are moving to boroughs like Staten Island to continue living and working in the city.
The long-term potential of Staten Island rental properties makes it worthwhile to put your investment dollars in this neighborhood. Just make sure to conduct plenty of research in order to find the best property in this community for your investing plans.
As prestigious as ever, Manhattan continues to attract a wealth of investors. Since the annual gross yield is significantly lower than the nation’s average, it’s essential to make wise investment decisions in this borough in order not to get burned.
The good thing about Manhattan investments is that the area has seen a continuous increase in its property values. Holding the property for a long-term period may considerably boost the value of your real estate portfolio.
Brooklyn was at one time a borough that was considered a cheaper place to live compared to Manhattan. While the average costs are still less than in Manhattan, the median rental prices have surged over time.
Now in Brooklyn you'll see a median rent amount of over $3000 per month. The annual gross yield for landlords is higher in Brooklyn than in Manhattan, reaching up to 4% in the best years.
The long-term view of things looks good for Brooklyn, as long as you don't wait too long for the market to cool down.
While Brooklyn is getting too expensive for some people, there will always be families and individuals who have the means to call Brooklyn their home.
Similar to Staten Island, the Bronx is a strong contender when it comes to increased real estate investment potential in New York City.
As Brooklyn and Manhattan get more expensive, the Bronx housing market offers a new haven for people looking to decrease their monthly rent payments.
In the coming years, the gross rental yield could reach 7% in the Bronx. While it’s impossible to predict the exact market in the future, especially in the midst of a global pandemic, the signs of success are definitely there.
As a real estate investor, it makes sense to consider the Bronx as your next investing destination.
Investing in New York City Neighborhoods
Chelsea: If you are looking for great value, the Hudson Yards oversupply of inventory has affected the prices in Chelsea. Rental investments in this area look bright, as the newly-developed condos come with top-notch amenities.
Bay Ridge: The abundance of greenery and wide residential streets can almost make you feel like you're in suburbia. Since Bay Ridge has a direct ferry to Wall Street, a commute to Manhattan can be a breeze for its residents.
Hudson Square: This is a neighborhood in Lower Manhattan that has seen primarily commercial use. The mix of modern condos, townhouses, and brick factories makes it an architecturally interesting area.
Additionally, Google has announced an expansion in Hudson Square, potentially creating further tech-fueled demand in the neighborhood.
Midwood: This area in Brooklyn can provide excellent value for first-time investors. This district has plenty of housing options to choose from. You are able to invest in multi-family units, low-rise apartment buildings, and townhouses.
Midtown South / Rose Hill: Consider this neighborhood bordering NoMad, as it is likely to generate more interest in the coming years. The convenient commute in combination with vibrant surroundings makes this neighborhood one of the top gems to invest in Manhattan.
The Bottom Line: Best Neighborhoods to Invest in NY
New York City is one of the most intriguing real estate markets in the U.S. Local property investments are changing year-by-year with booms and slumps taking place across the city.
If you are looking to put your money in long-term potential, consider the boroughs of Staten Island and the Bronx.
While the skyrocketing rental prices of Manhattan have driven some residents away, this neighborhood is still a hot market for buying real estate.