Should you buy an apartment building in New York city?
Is that a great place to invest or are you throwing your money down a hole in which you
will never get it back?
"Wait!
I thought they had really high rents?
We should be investing there."
or "Wait, I thought properties were so expensive, nobody could invest there?"
In this video, I'm gonna walk you through if you should invest in NYC or not.
All that and more, coming up.
Hey there, my name is Mike Fritz.
I'm the founder of Titanium Capital Investments in the multi-family CEO system and my greatest
passion is helping people just like you create financial freedom by investing in multi-family
real estate.
And in this video, I'm gonna share with you the 4 reasons I don't believe anybody should
invest in New York City.
Make sure you listen to every single one of them, because if you miss any of them, you
might be tempted to put your money there.
The very first reason I don't believe you should be investing in New York City is people
are leaving.
People are leaving.
So much of the entertainment industry is taking a hit in 2020 and 2021 in New York City.
People are leaving.
People are losing their jobs, their cost of living is so extremely high it's creating
an accedes from New York City.
By the way, this is happening in major metropolitan cities throughout the entire country.
Chicago, Los Angeles, Boston, Seattle and many other cities in which people are moving
away from because number 1, it's too populated, number 2, cost of living is extremely high
and they can really move their families to places that are much more spread out and their
dollar can go a whole lot further.
As you maybe have heard me say before, we only invest in multi-family real estate in
cities in which population is increasing.
In NYC, population is decreasing.
People are leaving.
Don't put your money in a city that people are leaving.
The 2nd reason I believe nobody should invest in New York City is the taxes are extremely
high.
The governor just talked about raising the tax to over 14 percent which will make it
the highest taxed area in the entire country and anybody who owns property there is gonna
have to absorb that tax bracket.
And believe me, that is a very, very high tax bracket to absorb when you're owning real
estate because real estate, although it has major tax benefits, you're gonna pay a lot
of tax because rents are so high in New York City.
You're gonna be making a lot of money but the expenses are gonna be so high, you're
not gonna really feel the weight of that income.
With taxes on the rise and population on decline, this is a recipe for disaster if you invest
in NYC.
Take your money and take it south-east or south part of the country.
Do not take it to NYC or else you'll see some really, really, really weak returns in the
future.
Now, if you know anybody who's thinking about investing in NYC, please do them a favor and
share this video with them.
Even people who just want to get into multi-family, make sure you share this video with them so
they don't invest in here to and we can protect them from a loss.
The 3rd reason I don't believe you should invest in New York City is the prices of property
are extremely overinflated.
They're selling you on what properties used to create but they're not selling you on what
they will create in revenue.
They're selling you on what they maybe made a year ago or a year and a half ago, they're
not selling on what they're gonna make in 6, 8, 12, 15 months from now.
And we always need to invest on where cities are going, not where they've been.
In investing in a city that's on that decline, that's gonna be a disaster in the future.
The cash on cash return just doesn't work.
When you pay that much for a property In relationship to the kind of rents they're getting, even
though those rents are high, you really don't get much cash on cash return.
And now, with the decline of population, you're gonna see that value go down.
If you're just new to our channel, I say this all the time.
If the numbers don't work, that's not out property.
We submit to the numbers and in New York City right now, I've underwritten hundreds of properties
all over the country.
Thousands of properties.
And I could tell you every time I write a property up in the north-east side of the
country, it usually does not work especially in New York City.
New York City is a very difficult place to find a property that's cheap enough to justify
buying it for the kind of revenue you're getting.
And because people are leaving the state, the value of property is going down.
And with the value of property going down, you're going to buy it and lose value right
away.
And with the value of property going down and people leaving, that means rents are gonna
go down.
So, you're gonna buy high and then you're gonna have to rent it out lower than what
the market used to rent for.
So if you buy a property based on what it was doing and then rents start to go down,
not only is the value going down and you can't sell it and then you try to rent it out but
you have to rent it out for less just to fill the unit, you're gonna be in a very, very
difficult position to get out of this property and really create a return.
And my last reason why you never invest in New York City, it's because the landlord laws
are horrible.
They're actually some of the worst in the country.
Some tenants can live there for 6 to even 18 months.
I've heard of some, even 2 years before a landlord can remove them from a building.
Now, imagine if you invest that much in a property and you don't get income for 2 years.
Imagine what that would do to your portfolio, what that does for you numbers and what that
would really do to your real estate business.
There are so many good places to invest in the country.
New York City, my friends, is not one of them.
Now, I may seem like I'm coming across very strong.
I want to because I want to protect you from investing in an area that's gonna take your
money and not provide any back.
So, be very careful when you pick your market and make sure when you're signing your next
closing documents, you're not signing them from an NYC address.
And here's a bonus tip.
Also in New York City, there's really strong rent control laws.
Meaning, if a tenant stays in your place, you can only raise the rent so much each year.
So, if a market rent is 4,000 a month and you started somebody off at 2,200, you can
only edge that up and it controls how fast you can raise that rent.
Well, if you can't raise the rent to market rent, you're losing opportunity money, meaning
what you should be renting that for, you're losing that every single month you own the
property.
With the landlord laws as hard as they are against landlords and with the rent control
laws that make it harder to make money in New York City, you're gonna find it really
hard to find a property that will make you money in the NYC area.
The truth is any time you go to invest in property or invest in multi-family, you look
at the area.
You look is the population growing, you look are there jobs going there, you look is it
landlord friendly?
You look at markets where other multi-family real estate investors are headed.
I will tell you this.
I have a really good beat on multi-family real estate investors and I don't know one
that's headed to New York City and I mean not one.
I know hundreds of investors that do this full-time for a living, not one of them is
headed to New York City with their capital because it's not a great place to invest.
So, I want you to make sure you're not one of those either.
I have a free gift for you for tuning in today.
I want to offer you our free multi-family masterclass.
It's a 60-minute training that walks you through how to start investing in multi-family real
estate.
So, make sure you go into the description, you click that link, join the multi-family
masterclass and you'll learn how to start investing in multi-family.
And believe me, it won't be in New York City.