There are hunch bets and then there are carefully calculated risks. Since I’m investing significant dollar amounts in residential real estate, I usually like to lean on the latter methodology of purchasing homes to either buy and hold or buy, renovate, and sell. With my property acquisitions in Leominster, I’m probably landing somewhere in the middle of gut instinct and good numbers. To begin with, Leominster median home values are about half of what they are in nearby Boston, so I can target single-family home investments at lower price points. And, because median home sales prices are on an overall rise, I can expect potentially higher returns when I sell—provided I keep my costs low. Additionally, while sales have continued to grow admirably since 2016, helping to create a seller’s market, supply is still greater here than Boston and its suburbs. That makes Leominster a great find for buyers whose budgets limit their choices in Beantown. It also makes a great case for the likelihood that property values could surge further in 2019.
In 2017, Amazon chose 20 finalists among 238 applicants for its “HQ2” sweepstakes, expected to create 50,000 direct jobs with another 250,000 indirect opportunities. Leominster, once among applicants that were up for consideration, was overtaken by Boston as the sole New England candidate to potentially land the deal. Nonetheless, Leominster was finally placed firmly on the map and in the sights of big corporate interests. But, even before the battle for Amazon began, Leominster home values did pretty well on their own. The expectation that they might do especially well in the coming year as a result of the residual effects of the “HQ2” sweepstakes is reasonable. A stronger job market will certainly help advance Leominster’s potential growth. The extra boost coming from home buyers who are expanding their search beyond the Boston market only adds to the reasons I chose to purchase below-market homes and income properties about an hour’s drive from Beantown. With or without Jeff Bezos, I’m fairly certain that a more attractive ROI will come.