So what about Amazon Headquarter 2? There is a lot of talk right now about what will happen to Real Estate in Long Island City, Queens New York.
Is now a good time to invest in property there? There are many factors – we will try to sum it up as succinctly as possible.
We are looking at this as an investment property, not something you would use as a primary residence which makes this a much more unemotional decision.
One of the main reasons to buy there now is that it is a buyers’ market right now, prices are generally down, some more than others depending on the price point. Many apartments are priced to move, from our experience buying in this type of market has a very long term upside.
Another good reason: the desirability of Long Island City will improve greatly over the long term. The big anchor tenant of Amazon will bring other businesses with it, the neighborhood will get more “neighborhoody” – our scientific way of saying all of the small things that make people feel more at home in well established neighborhoods – such as having your local coffee shop, tree lined streets, wine bars to stop in after work and quality grocery stores. As of now Long Island City doesn’t really have that feel to it. It is a neighborhood that transitioned from a barren light industrial manufacturing zone, to a neighborhood with tons of new office and rental buildings with sprinkling of restaurants and neighborhood amenities that is steadily improving.
As an investor, one of our main rules is to evaluate how much competition you will have finding a tenant and Long Island City may not pass that test for us in the short term. You would be competing with lots of rental buildings that would be offering “No Fee”, “One/Two Months Free” misc concessions, and all the bells and whistles that a new building offers – the over the top amenities, the concierge services, and brand new renovations.
Long Island City right now has a lot of rental buildings that are brand new and still in development. With so much rental inventory, you will likely have your apartment sit vacant longer while looking for a tenant and have downward pressure on your price, while at the same time competing with better buildings.
To sum it up, buying right now in Long Island City you will face some short term struggles finding a tenant, but as Amazon and other tech related companies come in, so will lots of demand, making it a very desirable neighborhood.
Another opportunity with Amazon that we find appealing is looking at the surrounding neighborhoods adjacent to Long Island City, the neighborhoods that are close by but already feel a bit more established and are undervalued; neighborhoods such as Astoria, Greenpoint, Sunnyside and even Midtown East.
People who work in Long Island City might be attracted to those neighborhoods as they offer a more fun atmosphere to live in.
If you would like to discuss more about the investment potential of Long Island city or other parts of Manhattan New York, contact us and hear our perspective on what will maximize your investment.