FEB 1, 2023
If you're thinking about house hacking in NYC, chances are that you've been inundated with different opinions and sources of where to start. Below are the top 5 tips for a new house hacker thinking about investing in the NYC market:
Often times, new investors and homebuyers will get excited with the prospects of getting "in the game" that they'll get carried away with questions such as: Where should I buy? What kind of research should I do on a market before pulling the trigger? Although these are the right type of questions to be asking, they should be asked AFTER first figuring out: What's my budget? Your finances are the most tangible factor that you have most control over, and will dictate the answers to all of your other investing questions.
The most common mistake new investors make, is having unclear goals before jumping into a big project. When it comes to house hacking in NYC, the advice is the same. Before pulling the trigger on any property, make sure you have a good idea on what you're trying to get out of this: cashflow, appreciation, rehab & flip, or maybe a mix of everything.
In the NYC market, like most high-price metro areas: You're likely not going to cashflow every month (unless you buy in all cash, or put down a big downpayment). If your end goal is still to cashflow, then your priority should be to either find a property that you can add-value into by investing $$$ for rehab — or invest in areas that are further out of NYC.
Over the last couple of years, NYC has been notoriously cracking down on landlords that are skirting the ever-changing housing rules. In the newest update, AirBnB's are not allowed to operate unless the guests have rented them out for more than 30 days. Although there are some exemptions around the newest round of housing laws, new potential house hackers should remember the rule of having clear goals in order to decide if they want to get into STR (short term rentals, < 30 days) or something more stable such as MTR (Medium) and LTR (Long)
There are thousands of small and big landlords in NYC, and as a potential house hacker, you should try to surround yourself with like minded people in order to make your learning curve smoother. Besides attending local real estate meetups, ensure that the agent you work with has also been a NYC native for a few years, and bonus points if she also house hacks. Being around other house hackers will give you a leg up because they understand the investing language you speak in, and are more than happy to tap into their network to give you help if you ask for it.
This content is meant for informational purposes only and is not intended to be construed as financial, tax, legal, or insurance advice.