Is Albany, New York a good place to invest in real estate? Depending on the headlines you’re reading, the answer is a definite yes to “definitely stay away.” Albany is the capital of New York state. The city of Albany is home to roughly a hundred thousand people. Albany sits at the center of the Capital District of New York State. While it may be overshadowed by New York City, it is the heart of its own metropolitan area.
Take cities like Schenectady, Troy, and Saratoga Springs into account, and the Albany real estate market is home to more than a million people. This makes the Albany housing market the third largest in the state. There are many variables that can potentially impact the value of a home in Albany (or any other market) and some of these variables are impossible to predict in advance.
Therefore, it is important to analyze the market as a whole before deciding to buy, sell, or invest in a new property. Let’s take a look at the latest housing market trends in Albany and find out the prospects of real estate investment.
Albany Real Estate Market Forecast 2020
What are the Albany real estate market predictions for 2020? Albany housing market 2020 is shaping up to continue the trend of the last few years as one of the hottest markets in New York. The latest real estate data from Zillow shows that the current median home value in Albany is $184,807.
Albany is currently a seller’s market – which means there are a lot of qualified buyers in the market place and not enough homes for sale in the market. The home prices have risen by 2.2% over the last year. Looking forward into the coming year, the Albany real estate market forecast is that home prices will continue to increase by 2.1%. Since 2015, the Albany home prices have increased every year from $162,000.
Here is the Albany, NY real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of 1% till Nov 2020.
The median list price per square foot in Albany is $123, which is lower than the Albany-Schenectady-Troy Metro average of $149. The median price of current listings in Albany is $175,000 and the median price of homes that have been sold is $181,700. The median rent price in Albany is $1,500, which is lower than the Albany-Schenectady-Troy Metro median of $1,600.
Zillow reports that 14.9% of the listings in Albany had a price cut in Nov 2019, which is a good thing for buyers. It shows sellers were willing to negotiate on prices as they were finding it more and more difficult to sell homes at asking prices. The median price per square foot in November was $218.
Albany Housing Market Forecast 2019 – 2021
Here is a short and crisp Albany housing market forecast for the 3 years ending with the 3rd Quarter of 2021. The accuracy of this forecast for Albany is 73% and it is predicting a positive trend. The LittleBigHomes.com estimates that the probability for rising home prices in Albany is 73% during this period. If this price forecast is correct, the Albany home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018. Check this page each quarter for updates to the Albany, NY Real Estate Market Forecast.
Albany Real Estate Market Trends
We shall now discuss some of the most recent housing trends in the Albany such as median home prices, inventory, economy, growth and neighborhoods, which will help you understand the way the local real estate market moves in this region. Trulia has currently 1010 resale and new homes for sale in Albany, NY including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process. Some of the most popular neighborhoods in Albany are Pine Hills, West Hills, Delaware Avenue, Arbor Hill, Melrose and Central Avenue.
West Hill offers residents an urban suburban mix feel and most residents rent their homes. It stretches from Central Avenue north to Tivoli Hollow, and from Henry Johnson Boulevard west to Manning Boulevard. There are currently 61 homes for sale in West Hills, Albany, NY. The home prices in Central West End neighborhood range from $600 – $148K. The median home value is around $55,000 and the median rent is around $950. Additionally, there are 9 rental properties for sale on Trulia and their rent prices range from $700 – $1.3K.
Pine Hills neighborhood in Albany is one of the best places to live in New York. It stretches from Manning Boulevard to the west, Woodlawn Avenue to the south, Lake Avenue to the east, and Washington Avenue to the north. The neighborhood consists mainly of freestanding multi-unit, duplex, and semi-detached houses and is home to Albany High School, the LaSalle school, the College of St. Rose, and the Alumni Quad of the University at Albany.
It is an urban suburban area and most residents rent their homes. There are currently 32 homes for sale in Pine Hills, Albany, NY. The home prices in Pine Hills neighborhood range from $69.5K – $3.61M. Additionally, there are 116 rental properties for sale on Trulia and their rent prices range from $700 – $1.3K. The median home value in Pine Hills, Albany is around $180,500 and the median rent is around $950. Zillow predicts that the home prices in Pine Hills will rise 1.9% within the next year.
In the past month, 100 homes have been sold in Albany, NY on Redfin.com. The median listing price is $206,000. In addition to houses in Albany, there was also 1 condo, 1 townhouse, and 105 multi-family units for sale in Albany last month. According to their statistics, the Albany housing market is very competitive.
The average sale price of a home in Albany was $200K last month, up 4.7% since last year. The average sale price per square foot in Albany is $121, up 1.3% since last year. A hot listing in Albany can sell for about 1% above list price and go pending in around 8 days.
Here is the latest Albany housing market data for the month of Dec 2019 from Redfin.com. The sale to list price ratio shows us that it was a seller’s market in the past month.
Albany Housing Market Trends in Dec 2019
|Median List Price||$207,000|
|Avg. Sale / List||97.5%|
|Median List $/Sq Ft||$125|
|Avg. Number of Offers||–|
|Median Sale Price||$200,000|
|Avg. Down Payment-||–|
|Median Sale $/Sq Ft||$121|
|Number of Homes Sold||100|
There are currently 684 homes for sale in Albany, NY on Realtor.com. The newly listed homes for sale are 12. The asking price of single family homes can start from $5,000 and can go up to $700,000 for a luxury property located in Westmere neighborhood in the city of Albany, NY. The median home price is Westmere is $277,000. It is an expensive neighborhood of Albany and homes are selling for $153/Sq Ft.
There are currently 180 rental properties in Albany, NY and their rent prices range from $150 to $2,600 per month. There are 23 new construction homes for sale in Albany within a price range of $364,900 to $625,000. The cheapest new construction home can be bought in Roessleville neighborhood of Albany. Roessleville is a popular neighborhood for buyers who can afford to buy a home in the median price range of $220K. It is less expensive than Loudonville neighborhood which has a median listing price of around $365,000.
According to their statistics, in November 2019, the Albany housing market was a seller’s market, which means there were more qualified buyers than there were active homes for sale. In other words, the demand for housing outweighed the supply. Ideally a buyer would prefer a sale to asking price ratio that’s closer to 90%. In Albany, the sellers have held good leverage in these negotiations in the past month. On an average, they could sell homes for 98.51% of the asking price. A seller would always prefer scenarios which can yield a ratio of 100% or higher.
In November 2019, the median list price of homes in Albany, NY was $206.3K, trending up 17.9% year-over-year. The median listing price per square foot was $124. The median sale price was $219K. On average, homes in Albany, NY sell after 78 days on the market. The trend for median days on market in Albany, NY has gone down since last month, and slightly down since last year.
The median list price in Albany, NY is $219,900 on Movoto.com. The median list price in Albany was less than 1% change from December to January. Albany's home resale inventories is 225, which decreased 20 percent since December 2020.
The median list price per square foot in Albany is $135. As you can see in the graph, the median price per sq ft rose to its peak value in May 2019, when it was $151, and then there was a continuous drop in prices. In December 2019 it was $137. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in January. The forecast from various other sources show that the Albany home prices will continue to rise by 1% to 2% in 2020.
Albany, NY Single & Multi-Homes Statistics
Following the real estate market decline in 2007 in the U.S., single family rental homes became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate. Single family rental properties have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.
U.S. single-family rental market has seen steady rent increases between 2010 and 2019. According to CoreLogic’s latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and among 20 metropolitan areas, it shows a national rent increase of 3% in April 2019, as compared to 2.8% in April 2018. The average sales price of new homes sold in the U.S. fell by 1.6% year-over-year in July 2019, to $388,000, according to the U.S. Census Bureau.
In fact, the median sales price of new homes sold fell by 4.8% to $312,800 over the same period. For existing homes, the median price was up by 4.3% to $280,800 in July 2019 from a year earlier, according to the National Association of Realtors. July’s price increase marks the 89th consecutive month of year-over-year gains. Demand remains robust. During the year to July 2019, new and existing home sales increased by 4.3% and 2.5%, respectively.
As per the real estate company called Neigborhoodscout.com, the median house price in Albany, NY is $188,407, which indicates that home prices in Albany are affordable and around the national average for all cities and towns in the United States. Multi-family apartments are the single most common housing type in Albany. One and two bedroom apartments are the most common housing units in Albany. Other types of housing that are prevalent in Albany include single-family detached homes, duplexes, homes converted to apartments and a few row houses. Albany housing market has more renters than house owners.
After the great recession of 2008, renting a home has increased exponentially across the nation. There are currently over 136.57 million housing units in the U.S. In 2018, the total number of homeowner households hit an all-time high of 76.2 million. 36.6% of households rent their homes and 64.4% buy their homes (2018 U.S. Census Bureau).
Currently, there are 148 single family homes for sale in Albany, NY on Zillow. Additionally, there are 42 single family homes for rent in Albany, NY. Under potential listings, there are about 7 Foreclosed and 102 Pre-Foreclosure homes. These are the delinquent properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
Albany, NY Foreclosures And Bank Owned Homes Statistics
As per the Albany foreclosure data by Zillow, in Albany 0.6 homes are foreclosed (per 10,000). This is greater than the Albany-Schenectady-Troy Metro value of 0.2 and also lower than the national value of 1.2. The percent of delinquent mortgages in Albany is 1.7%, which is higher than the national value of 1.1%. With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of Albany homeowners underwater on their mortgage is 8.7%, which is higher than Albany-Schenectady-Troy Metro at 8.2%.
|Total No. of Foreclosures in Albany||637 (RealtyTrac)|
|Homes for Sale in Albany||501|
|Median List Price||$204,900 (3% rise vs Oct 2018)|
There are currently 637 properties in Albany, NY that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 501. In November 2019, the number of properties that received a foreclosure filing in Albany, NY was 37% higher than the previous month and 6% higher than the same time last year.
Neighborhoods To Choose in The Albany Real Estate Market
If you are looking to invest in the Albany real estate, you should know the best places to invest in. The three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability. Desirability brings demand. Demand would raise the price of your Albany investment real estate and you should be able flip it for a lump sum profit.
When looking to invest in Albany real estate, you need to find places where the expected property appreciation forecast is positive. The running costs for owning and managing an Albany investment property should be low. The neighborhoods in Albany must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools and shopping malls. There should be a natural and upcoming high demand for rental properties and a low supply of income properties.
Albany is a moderately walkable city in Albany County. There are 36 neighborhoods in Albany. Some of the best neighborhoods in Albany, New York are Pine Hills, Campus Area, Delaware Avenue, Delmar, Elsmere, Loudonville, West Hill, Roessleville, Woodlawn Park, Hudson Park, Helderberg, New Scotland-Woodlawn, Center Square, Mansion Area, Normanskill and Buckingham Lake-Crestwood. Center Square has a median listing price of $384.9K, making it the most expensive neighborhood. South End is the most affordable neighborhood of Albany, with a median listing price of $77,000.
Here are a few good neighborhoods in the Albany real estate market which have the experienced the highest appreciation rates (List by Neigborhoodscout.com).
|1||Lark Dr / Manning Blvd|
|2||Madison Ave / Quail St|
|3||Central Ave / Colonie Ctr|
|5||Church St / Arch St|
|6||Madison Ave / Partridge St|
|8||Fuller Rd / Loughlin St|
|9||Madison Ave / Lark St|
|10||Everett Rd / Shaker Rd|
Is Albany, NY a Good Place For Real Estate Investment?
Investing in good real estate markets is touted as a great way to become wealthy. Is Albany a Good Place Real Estate Investment? Many real estate investors have asked themselves if buying a property in Albany is good investment? If you want to find out whether Albany real estate is a good investment or not, you need to drill deeper into local trends. The Albany real estate trends will tell what the market holds for the year 2020. We have already discussed the Albany housing market forecast for 2020.
Purchasing an investment property in Albany real estate is a little different from shopping for your car or primary residence. While you still want to get the most for your money, if you are looking to make a profit, you don’t want to buy the most expensive property on the Albany real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Albany that you might move into or sell at retirement in the future! Either way, knowing your profit potential and purpose is the first thing to consider.
Let’s now discuss state of the Albany real estate market, which can help investors who are keen to buy an investment property in this city.
Albany Real Estate Prices
New York City is one of the most expensive real estate markets in the world. On the flipside, the Albany real estate market is cheaper than average. The average residence in the Albany housing market costs less than 200,000 dollars. For comparison, the average home in the United States comes in at around 230,000 dollars. That makes Albany real estate investment properties a relative bargain. That’s aside from the sheer number of one and two bedroom properties in the Albany housing market that you can snap up for less than 120K.
The cost of Albany real estate investment properties is on the rise. Home prices in the Albany housing market have been appreciating faster than local incomes have grown every year since 2000, though prices did dip in the Great Recession. Home prices have doubled since 2000. Home prices are expected to go up roughly 2 percent in 2020 after appreciating two percent in 2019.
One trend driving this is the tendency toward luxury home construction. Roughly half of newly built homes are in the 400K plus price range, while less than five percent cost less than 200K. That increases the value of the existing housing stock. Yet this has led to a boom in multifamily housing. This means there is a strong future for Albany real estate investment in apartment buildings.
Redevelopment often consists of tearing down vacant inner city housing to build new multifamily buildings. Fix and flip is certainly possible in Albany, given that nearly 15 percent of homes are currently vacant. And half of all homes in the Albany real estate market were built before World War 2.
The Albany housing market comes with the added benefit of being divorced from New York City’s rise and fall, since Albany is a several hour drive from the Big Apple. The Albany housing market is also several hours from Buffalo, the other major metropolitan area in upstate New York. Home values are based on local supply and demand, not speculation and fear.
The Legal Climate
New York’s legislature passed rent control on a statewide basis in 2019. This is cratering the New York City real estate market. It isn’t having much impact on the Capital region. The Albany area is much more landlord friendly than NYC. For example, Albany allows for short term rentals via AirBnB as long as you’re registered and pay the 10 percent tax, whereas NYC makes it almost impossible unless you’re sleeping in your bedroom while the guest sleeps on a couch.
Real Estate Tax Rates
Tax rates on a New York City property can hit 20 percent. New York City’s property tax code is riddled with exemptions, waivers and other rules that make it insanely hard to calculate, too, when you’re searching for an investment property. The property tax bill on an Albany home would be roughly 1.75 percent of the property’s value.
Note that this is on a far cheaper property, too. That results in an average tax bill of less than four thousand dollars. The reports of this being one of the highest per capita property tax rates are comparing this 4K tax bill to the average person’s income. That does help explain why the majority of people in the Albany housing rent rather than own.
One point in favor of Albany real estate investment is the strong economy. The unemployment rate hovers around one percent. More importantly, average pay in the Albany area is highest among upstate cities, while cost of living is at or below average. For example, Albany’s cost of living index is 102 while the national average is 100. But that’s well below NYC’s 120 cost of living index and paying 3-4K to live in a one bedroom apartment. And the ability to afford to own a home or live in a large apartment with space for a family makes up for Albany’s less-than-ideal quality of life.
Quality of Life
Quality of life does mar the value of Albany real estate. The city has a crime rate that puts it in the worst ten percent in the country. And this isn’t something you can blame on tourists and criminals who prey on them. The crime rate in Albany is actually higher than New York City. Note that this varies by neighborhood, and a number of suburbs in the Albany real estate market are much safer.
Albany’s schools aren’t the best, but this is something that varies from neighborhood to neighborhood. Livability indexes give Albany a bad grade due to the harsh winters, but that’s true for the entire upstate New York area. On the flipside, the city stands out for amenities like parks and museums. That is part of the benefit of being a state capital. That’s why the livability score for the Albany area is 57 out of 100.
The Albany real estate market is bolstered by a relatively young population. This is due to the multiple colleges in the area that are found around any state capital. This also means that you can hold a diversified Albany real estate investment portfolio catering to students.
While Albany isn’t seeing rapid population growth, its strong, stable job market and the influx of students who come to stay mean that it is seeing slow, steady population growth. And that is in sharp contrast to the population losses in the rest of upstate New York. We expect this to help maintain the value of any Albany real estate investment property you buy.
Investing in Albany Real Estate or Not: The Conclusion
Maybe, you have done a bit of real estate investing in Albany, New York but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. Albany is a steadily appreciating real estate market. While it isn’t as famous or hot as NYC, it offers an affordable entry point and massive pool of perpetual renters.
Though it may not be somewhere you want to live, many locals are choosing to stay and make their homes here. And that will continue to drive demand for Albany real estate investment properties as long as they are priced right. A good cash flow from Albany investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Therefore, finding a good Albany real estate investment opportunity would be a key to your success. If you invest wisely in the Albany real estate, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate. Most investors naturally gravitate to residential property investment. When looking for the best real estate investments in Albany you should focus on neighborhoods with relatively high population density, employment growth and strong appreciation potential.
Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable. You must also collaborate and learn from savvy investors who have retired early on in their lives by investing locally in the Albany real estate market. As with any real estate purchase, act wisely. Evaluate the specifics of the Albany housing market at the time you intend to purchase.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Albany real estate in 2020. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Other Good Markets To Invest in Real Estate in 2020
Another good market to invest in real estate is Green Bay in Wisconsin. Green Bay is a steady, stable and profitable housing market in an area marred by decline and, occasionally, rebirth. That makes it a good opportunity for real estate investors. The Green Bay housing market is stable because the Green Bay economy is diversified and stable.
Roughly one in five jobs are in manufacturing, but more importantly, the job market has other, growing sectors. The city remains a transportation hub; it is a major distribution hub for Wisconsin with roads, railway connections, highway access and pipelines. For example, there’s a petroleum storage terminal.
The other real estate market which looks good for investment in 2020 is Galveston in Texas. Galveston is more than the resort town for south Texas. It is a vibrant coastal city with multiple universities and an active port to provide steady regional employment in addition to the massive annual flood of tourists. The Galveston real estate market contains two massive populations of renters.
One is the large contingent of tourists who arrive in droves in Spring Break continue coming through Labor Day. Roughly 7.5 million people visited the city in 2019. This is one reason why the Galveston real estate market was ranked among the best in the country on short term rentals to tourists in 2016.
Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
Updated Market Prices, Trends & Forecasts
Quality of life