Why We Are Investing In Northlake

“Courage taught me no matter how bad a crisis gets … any sound investment will eventually pay off.”

Carlos Slim Helu

This blog should be encouraging to everyone, since no one can be an expert in every location. This blog will give you tips on how you can get ‘insider information’. It’s possible because in real estate, no one can be an expert in every location, thats impossible. 

Real Estate is hyperlocal, and even though I know more about real estate in general, you know more than me about your specific block: You know which neighbors are loud, unfriendly, or seemingly up to no good. I have more information about my block than you do because I live here, and vice versa. 

We are investing in Northlake because we understand the market. I have seen enough properties in Northlake to confidently judge home price and condition. When I first looked at 341 Armitage, I saw a great deal, but it was presented horribly and was even underpriced.

Key Points that led to my decision

• I walked every single new listing in Northlake for weeks, trying to help another buyer with a similar purchase. Seeing many homes gave me a good idea of the condition, sales price, and DOM.

• I spoke with a lot of listing agents, attended open houses, and talked to them over the phone. I asked questions regarding traffic, offers, and overall market sentiment.

• I represented a buyer in a purchase of another cape cod, about a block and a half away. I spoke to its listing agent, and although my buyer was the highest and best, it received many offers well above asking.

• My sister tested the rental market in Northlake and received an additional $150 dollars more than what I had expected. It gave us confidence that not only is their buyer demand in Northlake, but it is increasing, as well.

Why Not Flip Something Bigger In Another Area?

We should not forget that we are still not clear of the most devastating pandemic of our lifetime. Although I am optimistic, I do see many uncertainties and possible side effects from the lockdowns in March that could impact future investments. 

Trying to play risk manager here, I feel it’s less risky to strategically invest in this hot market, and in the hottest price range with the highest demand.

Taking a look at Altos research, we see it is not A or B Neighborhoods that are in a seller’s market. It’s specifically C middle-class neighborhoods that are seeing the highest demand.

In my opinion, the easiest positioning is to improve 341 Armitage from the lower price range into the median MLS sales price of $250k+.

What are the Possible Negatives of Investing in Northlake?

• Middle-class neighborhoods I have found are often very strict with code violations, inspections, and additional permits. This drowns out rehab timelines. I have never dealt with the Northlake building department, but my father said they are friendly and helpful. I hope he is right because this home needs a lot of work. 

• Northlake is a blue-collar middle-class neighborhood. If we see another recession or we are unable to fully recover, neighborhoods like Northlake and their residents are likely to be some of the most affected. If there is no demand and no buyer, home prices come down.

Conclusion

In conclusion, 341 Armitage is an investment, and like with all investments, it comes with risk. Homes and home values are somewhat subjective. Human emotion and market conditions affect the price, and I have often found myself questioning my decision, whether I am on the losing or winning side of the bid. If you are the winning bid you often wonder what you missed that other potential buyers found. If you are on the losing side, you also wonder what you missed, and why someone else’s subjective value is higher than yours.

Investing in real estate is risky, but if you think it is too risky, you should see how chancy it can be not to invest at all. Do your due diligence and make the best decision with the best information you have. You will either win or learn. Either way, it’s a step forward.