This story originally appeared on Business Insider.
Julia Lemberskiy has always been fascinated by interior design.
As a kid, “I never watched soap operas. I was just filming renovation shows,” the 30-year-old technician, whose career has consisted of founding startups and running Uber Eats Russia, told Insider.
She is currently the growth leader at Double, a start-up that matches executives with part-time assistants. Outside of her day job, she still makes time for her original passion: “As often as other people scroll on TikTok, I spend hours a day on Zillow.”
This gives her an advantage as a real estate investor.
“Having attended so many renovation shows, I have a really good idea of what a property might look like,” said Lemberskiy, who grew up in Europe, moved to New York City in 2018 and currently has three US investment properties owns. “When I visit a place, I immediately see what wall I would tear down. That really helped because I’m not competing with buyers who don’t have that vision.”
Her general investment strategy is to buy “undervalued properties” in “undervalued areas” which she finds through approved development projects in the community. When the city or county invests millions of dollars in improving the area, it usually signals that there is upside potential.
Also, she’d rather spend her money on a few cheaper, fancier properties that she could upgrade than pour all her money into a nicer, more expensive property or two.
“The more we buy, the cheaper we get,” she said, referring to her and her husband, who currently reside in Midtown Manhattan. “Right now we’re reviewing a number of properties in the $150,000 range.”
As she puts it, “You really can’t go wrong when you buy something for $150,000 and it’s a livable house. It probably won’t go down in value.” “A purchase in the $1 million to $1.5 million range would make me very nervous for a property with that much money in it.”
Additionally, using her capital to acquire a handful of properties has allowed her to “play around in different areas and get a feel for different types of investments — multi-family or single-family homes — to figure out over time what the long-term plan is.” .” will be.
Lemberskiy owns six units in three properties and rents five of her units through Airbnb. Courtesy of Julia Lemberskiy
Your strategy has evolved over time. When she first decided to buy a property, she assumed she’d own where she lived — in New York City — but a few Zillow searches “kissed me for a while.” to buy something in New York,” she said.
First of all, the purchase prices in New York City are astronomical. Manhattan, New York is the most expensive real estate market in the USAand Brooklyn and Queens, two of New York City’s other five boroughs, both made the top 15 most expensive markets.
“When we looked around here, we could only afford a small studio because even a decent studio costs $400,000 to $500,000,” Lemberskiy said. “It’s crazy. But even crazier is the maintenance fee.” You’re lucky to find something that costs less than $2,000 a month.”
It’s also a highly competitive market, she added. “You have to ask for more.” On the few properties that she and her husband have bid on in the city, “we’ve been outbid every time.”
Rent in NYC, buy in cheaper markets and generate up to $20,000 a month in Airbnb revenue
Ultimately, Lemberskiy couldn’t justify buying anything in New York City, she said, “When you think about it as an investor, the prices are already that high. How much higher can it go?”
She and her husband decided to continue renting. It is possible to find good deals the most expensive rental market in Americasaid Lemberskiy, who pays less than $2,000 a month for a midtown Manhattan studio, “Sometimes there are really good deals if you take the time. Some of this requires negotiation.”
While buying real estate in New York City was off the table, buying real estate in general was not, especially when Lemberskiy decided to settle in the United States.
“After I got married and decided to stay in the US, I knew I wanted to invest in something,” she said. That was in 2020, right after the pandemic broke out. The big question was where to buy it. “Being new to the US, I had absolutely no idea where to start.”
Lemberskiy and her husband closed their first home in the early days of the pandemic. Courtesy of Julia Lemberskiy
She decided to buy a house in an area where she could imagine living. In the early days of the pandemic, that was New York State.
“I felt imprisoned in Manhattan, so whenever I got a chance I would board the Metro-North at Grand Central, exit a new station, and spend a day exploring the area,” she recalls. “I really got a feel for the whole area of upstate New York.”
She found a real estate agent and began to view properties.
“It was the early Corona period, when everyone was fleeing New York and working remotely, and interest rates were extremely low, so it was extremely competitive,” Lemberskiy said. “Nothing stayed on the market longer than a few days.”
The house she and her husband eventually bought was a three-bedroom house on a lake in Walden, about 70 miles north of New York City. In the 2.5 days it was on the market, “there were 54 showings and 14 offers, including many cash offers,” she said. “So our chances were very slim. In the end, we removed all contingent liabilities from the contract, more than we asked for, and wrote a long, tearful letter to the owners. To our surprise we got the property.”
They closed in March 2021 for $285,000 with the intention of using it as a weekend home, but “this house was a complete disaster,” recalls Lemberskiy, who ended up living there almost full-time for six months, doing renovations to make it fit create. livable,” she said. “It was hard and expensive and after a while I got sick of the house and didn’t want to be there anymore.”
This gave rise to the idea of only staying in it occasionally and renting it out via Airbnb, which she has been doing since 2022.
In 2021 and 2022, she acquired two other investment-specific properties: a $220,000 single-family home in West Palm Beach, Florida and a $185,000 multi-family home in Albany, New York.
She chose these markets in much the same way she chose New York State, “for personal reasons,” she explained. “Even if business doesn’t work out, it’s something where I can see myself and my family again.”
Florida first appeared on her radar when she rewatched The Sopranos with her husband. She said, “There was a scene where the uncle is talking about going to Boca, and we were like, ‘What is Boca?'” A few weeks later, I found a cheap flight, booked an Airbnb, and fell in love the whole area an hour outside of Miami.
She completed the beach house in September 2021. It already had one tenant and remained on a long-term lease until January 2023, when she first began listing it on Airbnb.
As for Albany, that deal came about after she and her husband discovered the capital on a road trip to celebrate their anniversary.
“We spent some time there and visited some nice restaurants and bars,” she recalls. “I started looking at Zillow and was pleasantly surprised at the cost for such a beautiful city.”
Lemberskiy and her husband got married in 2020. Courtesy of Julia Lemberskiy
In April 2022, she completed a four-unit estate in Albany. Three of the units are residential, which she rents out through Airbnb, while one is commercial, which she’s converted into more of a utility space.
Between the Walden Lake home, the Florida beach home, and the Albany apartment building, Lemberskiy operates five Airbnb spaces that brought in $19,828 in revenue as of March 2023, according to a screenshot of her Airbnb dashboard viewed by Insider . So far in 2023, their units have generated over $10,000 in gross earnings each month.
What began as a search for a home in New York City has grown into a lucrative short-term rental business that has given Lemberskiy and her husband financial freedom.
“I’m very reassured now,” she said. “In the worst case scenario, both I and my husband will lose our jobs. We can move into the lake house and cover all expenses from the other two properties. Having this level of financial independence makes me less willing to do the whole build again.” -Temporary rental again.”
After all, buying and renting real estate is not for the faint of heart.
“There were a lot of tears,” she said. Buying in Albany was particularly difficult when I was trying to secure a mortgage and “almost put me off real estate forever.” You have to be very stress resistant and very detail oriented for all of this because there is just so much paperwork.”
Still, she’s still looking for other “undervalued areas” to add to her portfolio. She searches for areas like Bridgeport, Connecticut, Schenectady, New York and even overseas in Madeira, Portugal.
Her top advice to new real estate investors is to buy in a place “where you want to be. If you can see yourself there, chances are other people can see that too.”