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Why You Should Invest in Burlington - Vermont's Multi Family Real Estate

City of Burlington waterfront from Lake Champlain

Are you considering investing in multi-family real estate in Burlington, Vermont? If not, maybe you should be! Burlington’s rental housing market is tight. Homebuyers and investors from outside of Vermont moved to the state searching for more affordable housing compared to their bigger city counterparts.

Everywhere you look, new people are moving in, and many Vermont locals are searching for affordable rentals. That means there are renters in Burlington looking for rentals in their budget and with low vacancy rates, it’s the perfect time to start investing in multi-family properties.

Continue reading to learn why you should invest in Burlington’s multi-family real estate market.

Reasons You Should Invest in Multi-family Properties

Investing in real estate is a great way to diversify your investment portfolio. If you want to get into real estate, there are a lot of great ways to get started. Multi-family real estate can offer investors a lot of benefits, including reduced risk and scalability. But some of you may be wondering why you’d want to invest in multi-family properties in Burlington.

1. Your Real Estate Portfolio Will Grow Faster

Multi-family homes are the way to go if you want to grow your real estate portfolio. It's much easier to buy a ten-unit apartment building than it is to buy ten single-family homes. In addition to working with only one seller instead of 10, you only need one loan instead of ten separate loans for each single-family home.

Moreover, the cost of a multi-family home and single-family home is near the same median sale price. From January to June 2021, single-family homes had a median sale price of $360K and multifamily homes were around $415.5K. Now, remember, a single-family home means one passive income, whereas a multifamily home offers multiple unit incomes to pay down the property mortgage.

2. Less Risk

If you own a single-family home, and it sits vacant for a couple of months, you're still responsible for the mortgage payment. If you invest in multifamily property and one of the units is vacant, the other units will cover your expenses and hopefully still generate cash flow. Multi-family properties protect investors from many of the risks associated with being a real estate investor.

3. Easier To Finance, But At A Higher Price

As we mentioned above, multi-family homes do cost more to purchase than single-family homes. However, the individual cost per unit might be way less. For example, a single-family home in your neighborhood may sell for $120,000, while a four-unit building may sell for $250,000. Even though the multi-family home is more than twice as expensive, each unit is only about $62,500, nearly half the price of the single-family home. A multi-family building tends to be much easier to finance due to its overall cash flow and the lower amount of risk the lender takes on.

Should I Invest In Multi-family Properties in Burlington, Vermont?

You can easily reap the benefits of these beautiful multi-family homes, whether they are small, two-unit duplexes or large, multi-family buildings. Rent out the units or move in with extended family, so everyone can have their own space while still being together. In Burlington, you'll be close to the best features Vermont has to offer: Lake Champlain, Church Street Marketplace, nearby mountains, and more!

Since 1998, Steve Lipkin has helped investors purchase property in the Burlington area. Please contact us to learn more about what our team can offer you in your next purchasing decision.

Get Paid To Move To The Green Mountain State

 

Vermont is more than just an ideal vacation location – it is the perfect place to call home! From the Green Mountains to Lake Champlain, Vermont’s quintessential small and large towns offer something for everyone in search of the ideal area to prioritize their work/life balance.

The state has a small business based economy that creates the dynamic of small-town life, but with all the amenities of a larger city. With highways, multiple airports, Amtrak rail services and easy access to Boston, New York City and Montreal Vermont businesses have the necessary speed and access to their supply chains.

To help with the jump to move to Vermont there is up to $7,500 available through the New Relocating Worker Grant for new residents taking a qualifying job with a Vermont employer. The initiative is to encourage workers to make the move to Vermont to work for Vermont employers.

Along with our knowledgeable agents, ThinkVermont is a great resource to begin your research on Vermont’s relocation tools.

If you are considering making the move to Vermont our experienced agents would be happy to speak with you about the housing market and options available to you.

To learn more about our demonstrated, client-focused strategies and services, give us a call at (802) 846-8800 or email us at Team@LipkinAudette.com.   

Buyer's Guide to Winning in a Seller's Market

Photo by Grace Elletson/VTDigger

There has been a lot of press lately, both locally and nationally, about rising prices in real estate and the increased buyer demand that has followed the COVID-19 pandemic.  Many of these articles have shared stories of buyers who have lost out on numerous homes in situations of multiple offers, waived contingencies and all cash, quick closing offers.

While there is no denying that increased buyer competition has driven home prices up, a record number of home sales also means more buyers than ever are successfully purchasing new homes.  It’s more evident than ever that exceptional agent representation makes a significant impact on a buyer's chances to land that home of their dreams.

In a VTDigger article published in mid-March, I provided additional insight into the trends we were observing in the local market.

Burlington housing boom stokes rising home prices and affordability concerns | VTDigger.com

Since that article was published, the market has continued along a similar path with more homes being listed and sold at or above list price.  And while it makes for eye-catching headlines, our local market isn’t being dominated by out-of-state cash buyers and great opportunities still exist for well-prepared buyers looking to make a move. 

The key is to partner with an agent and team that can guide you on how to best stand out from the competition and has proven results in this current, competitive seller’s market.  To learn more about our demonstrated, client-focused, strategies and services, give us a call at (802) 846-8800 or email us at Team@LipkinAudette.com.   

City of Burlington Announces New Online Permitting Portal

Photo Credit: ©Scott Teresi

City of Burlington Announces New Online Permitting Portal

The City of Burlington debuted its new online permitting portal this week making it easier to get and track down permits.  Applicants can now save trips to the city’s office located on Pine Street and will be able to track their permits in real time.  The portal is currently set up to support the City’s permitting needs but will expand its system to support a wide range of applications. 

In 2020, the city estimated the likelihood of getting through permitting correctly the first time at around 20%.  With the new system in place, both applicants and Burlington employees will save time and move through the permitting process with fewer mistakes.

For more details check out the Vermont Digger Article, “Mayor encourages use of new online permitting portal

** If you are interested in learning more about Burlington’s Zoning Laws or Housing Market please give Steve a call at [802] 846-9575 or email us at Team@LipkinAudette.com 

Burlington's Tight Rental Market

Photo Credit: ©Eve Event Photography LLC

As Burlington’s housing market tightens, renters are reporting extreme difficulty in finding suitable and affordable housing in the Burlington area.  Over the past decade, Chittenden County’s rental vacancy has hovered around 2%.  The figure rose to 2.6% during the pandemic but has plummeted to 1.1% in a recent survey conducted by Allen, Brooks, and Minor.  Landlords are reporting unusually high demand on their postings with one landlord reporting over 50 inquiries in a two week span on a single vacancy.

Vermont has seen a large increase of out of staters migrating which has squeezed the market even more.  Landlords are also facing pressure as a city wide reassessment on property values has increased property taxes.  These factors have ramped up the demand as well as the cost of living in Chittenden County.  

For more details check out the Vermont Digger Article, “Burlington’s tightening housing market has renters scrambling

** If you are interested in learning more about the Burlington Housing Market please give Steve a call at [802] 846-9575 or email us at Team@LipkinAudette.com

Burlington Citywide Reappraisal Results

The City Assessor has just published the new Assessed values for all Burlington properties. Click HERE to search the Burlington.gov property database for the updated Assessed value for your property.  Please note that updated property tax bills using the new assessed values will be mailed out to homeowners starting on July 2nd, 2021.   

As your local experts for Burlington real estate, please feel free to contact us to learn more how the updated taxes will impact your property's current market value. 

For additional information about the reappraisal process, check out the link below...  

https://www.burlingtonvt.gov/assessor/REAPPRAISAL

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    Resolution to Pay Workers Prevailing Wage Pushes Through City Place Settlement

    Photo Credit: ©James Buck | Seven Days

     

    Last Tuesday night, the Burlington City Council dropped their previous lawsuit and unanimously approved the new development agreement for City Place.  Six years after the plans were first introduced, the project is now scheduled to commence no later than September 2022.  

    The vote was previously delayed as it did not guarantee union workers labor for the project.  Earlier this week, Mayor Weinberger negotiated a deal with the developers that promised workers prevailing wage rates that pushed the vote through.  Now that the legal battle is over, the project is set to restart and turn “the pit” into an innovative city center. 

    For more details check out the Seven Days Article, “Burlington City Councilors Approve CityPlace Settlement”.

    ** If you are interested in learning more about the development / housing in Burlington and the surrounding communities please give Steve a call at [802] 846-9575 or email us at Team@LipkinAudette.com

    2020 Multi Family Review & 2021 Forecast

    The demand for Chittenden County Multi Family remains strong despite the most tumultuous year in any of our lifetimes. The Burlington area rental property market is well-positioned to endure bumps in the road while maintaining a consistent and moderate upward trajectory. A close look at the key metrics offers optimism for both tenants and landlords alike.

    The Chittenden County apartment market is experiencing the lowest apartment vacancy rate in the last 6 years according to Allen, Brooks & Minor (December 2020 = 1.1%). Government sponsored rental housing stabilization funding and a decrease in new construction coming on line are key contributing factors to the record-low vacancy rate. Anecdotally, we've also heard that student rental properties reported very few delinquencies even with the challenges that local universities are facing with in-person learning during a pandemic.

    The decrease in new apartments was heavily influenced by a six-week shutdown of all non-essential new construction in Spring of 2020 and a limited supply of labor and materials. Growth is projected to rebound in 2021 with Burlington accounting for one-quarter of all new projected units in Chittenden County. New construction at Eric Farrell’s Cambrian Rise is expected to account for the majority of Burlington’s apartment growth in 2021- in the meantime, there is renewed optimism at the long delayed CityPlace Burlington project. The new proposal includes over 400 units of housing- but isn’t expected to contribute to growth figures until phase one is completed in 2023 (hopefully!). Nearly 25% of Chittenden County’s new apartment growth will be within existing buildings like hotels and office buildings that are being redeveloped. In Essex, apartment growth will be concentrated in three separate projects all in the Five Corners neighborhood whereas Winooski is projected to add additional units along the primary gateways, including East Allen and Main Street.

    Demand from Multi Family investors fueled an increase in apartment sale prices, which similar to residential sales, was driven in part by historically low interest rates. The average sale price for 2020 was $552,952, up 16.3% from 2019. The average price per bedroom increased by 2.7% and the average price per square foot grew by 7.5%. Meanwhile, the annual rent inflation percentage has trended in the opposite direction from nearly 3% in 2015 to just over 1% in 2020. This data suggests that in 2020, landlords have been more focused on tenant retention and rent loss prevention versus increasing tenant rents to help offset the added operating expenses. Despite the increase in sale prices, Cap Rates remained relatively unchanged in large part due to flat rents and the average operating expense ratio growing from 30% to 33% over the past 6 years. Burlington Multi Family sales in 2020 saw an average sale price of $773,863 and a list to sale ratio of 96.6%. The average cap rate for sales in Burlington in 2020 was 6.77%.

    As reported by numerous national publications, Burlington is consistently ranked as one of the top places in the United States to live. The Burlington region is now benefiting from a surge in remote workers migrating from major cities seeking a better quality of life coupled with an emerging hi-tech workforce- most notable at Russ Scully’s redeveloped 143,022 square foot HULA campus on Burlington’s waterfront. Despite the chaos of 2020, the Burlington area Multi Family market fundamentals are solid, and we continue to see strong investor confidence. 

    Having helped hundreds of local clients build wealth through real estate investing, the Lipkin Audette Team understands that, as is the case with any investment, a successful investment strategy needs to be designed to fit an individual’s particular set of needs and goals. If you’d like to speak with our team about how to get started or what the current market value of your property / portfolio might be, give us a call anytime at [802] 846-9575 or email Steve@LipkinAudette.com.   

    Burlington and South Burlington Rank Among The Top Safest Cities in the U.S.

    Vermont is again receiving national recognition. This time for having two of the safest cities in the U.S.  In a study comparing 180 cities across 42 indicators, South Burlington ranked second safest while Burlington ranked the sixth safest. The study considered the fewest assaults per capita, fewest traffic fatalities per capita, lowest unemployment rate, and lowest number of uninsured population. Some indicators have a bigger multiplier and are weighted more heavily than others. For example the average Covid-19 cases over the last seven days per 100,000 people carries a triple weight and accounts for 6.8% of the score, tied for highest out of any category. Vermont has the second fewest cases per 100,000 people at 1,809, only trailing Hawaii by a slim margin.  It goes to show that implementing strict Covid guidelines and having a community devoted to caring about each other can help shape two of the safest cities in the country. Especially during these crazy times, a sense of peace, calm and safety is more important than ever.

    To read more about the safest cities in the U.S. and see the full list of rankings click the link below.

    Safest Cities in America | WalletHub.com

    If you are interested in relocating to Vermont or would like to learn more about single family and multi family homes in Chittenden County, please give Steve Lipkin a call at [802] 846-9575 or email us at Team@LipkinAudette.com