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The Best Places to Live 2008

March 2008
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The Fearless Flipper

Would you want to be a real estate investor right now? You would if you were Fran Yerardi, house-flipper extraordinaire, who believes almost no property is too far gone to be rehabbed for a profit—and is more than happy to share his secrets with those willing to roll the dice with him.

By Daniel McGinn

Photo by Kathleen Dooher

 

The two-family house at 95 Hollingsworth Street in Mattapan has seen better days. The paint on the porch is peeling. The aluminum siding is weathered. Inside, the empty second-floor apartment is pure squalor, with plaster hanging from the ceiling. The owner, Fran Yerardi, motions toward the back of the house. "I'll show you where he did the deed," he says, walking to a dingy bedroom. Yerardi points to blood splatters under the window and remnants of crime-scene tape on the door frame. Two years ago, the home's former resident, a 70-year-old retired machinist, was allegedly beaten to death in this room by his 41-year-old petty-criminal son, who then dragged his father's body to the basement and cut it into pieces, dumping the head and limbs in a yard a few miles away. Back in the kitchen, the woodwork retains a coating of the powder that detectives used to lift fingerprints. Out front, the victim's name is still on the mailbox.

Last fall Yerardi, a West Newton–based real estate investor, purchased the 2,800-square-foot duplex for $209,000. "This is an okay house," he insists. He walks through the gutted downstairs rooms, explaining his plan to convert both apartments' dining rooms into bedrooms, then to resell the property as three-bedroom condos. "The way I look at it, the ceilings are high, the doorways are awesome, the hardwood floors are perfect," he says. "It's got a good roof, good windows—it's ready to [renovate]." If you factor in what Yerardi has spent to empty the home of garbage and demolish the downstairs walls, as well as the interest on the money he's borrowed to buy the home, he's already invested $225,000. But after $100,000 more in renovations, he hopes to sell the pair of condos for $500,000. True, the house's history presents some challenges: Twice Yerardi nearly sold the place to people who intended to rehab it themselves, but each time the neighbors scared them off by vividly recounting the murder. Still, he's not worried. "It is what it is," Yerardi says. "We'll get out of it in a couple of months, and we'll make money on it."

He walks down the stairs, shuts the door, and secures the lockbox. As he strides toward his Jeep Grand Cherokee, he looks back at the decrepit house and utters the phrase that has become his mantra since he became a full-time real estate investor two years ago: "Who else is going to buy that house but us?" That is, who'd buy it before he's finished transforming it—at which point he expects to have no problem finding someone who will dig deep to take it off his hands, and give him a six-figure profit for his trouble.

This seems like an inauspicious time to try to profit from investing in homes, what with Massachusetts, like much of the nation, now mired in a housing downturn that's not just brought a jarring end to a half decade of sharply rising prices, but also appears likely to exact a lot more pain before it's through. In 2007, lenders foreclosed on 7,653 homes statewide, more than double the total seized the previous year. In Suffolk County, the median home price dropped by 5.7 percent, from $350,000 to $330,000, according to real estate research firm the Warren Group.

As politicians debate proposals to ease the skid, however, another group views the current atmosphere a bit differently. Sure, it's a lousy time to try to sell a house, but it can be a fabulous time to buy one. That's giving hope to a new generation of real estate speculators, who continue to tune in to Flip This House and crowd into meetings of the Massachusetts Real Estate Investors Association. Where some fear the worst housing market since the Great Depression, others are seeing a great chance to scoop up deals.

Yet even among those determined optimists, few are buying as aggressively as Yerardi. The 40-year-old married father of three first tried his hand at real estate in the mid-1990s, a few years after opening Yerardi's Restaurant on Watertown Street in West Newton. He started by buying homes adjacent to the restaurant and renting them out. Every so often, he'd buy a house to rehab, doing some of the basic work—like demolition and painting—himself. During this time, Yerardi also became active in Newton's chamber of commerce, and was asked to join the board of directors of a local bank. Three years ago, near the peak of the housing boom, the bank hosted a strategy session. There, Yerardi learned about homeowners' fraying balance sheets and the growing risk of a housing downturn. Seeing the opportunity that would create, he decided to make property investing his full-time gig.

In 2006, Yerardi paid $50,000 to become New England's first franchisee of Home-Vestors, a Dallas-based company that teaches operators to flip houses. Founded in the late 1980s, it today has 260 offices across the country, and provides people like him with training, financing, and advertising—via those billboards that scream "WE BUY UGLY HOUSES"—that yield a steady flow of owners looking to unload their homes. Greater Boston, with median home prices topping $300,000, is considered a tough place to ply such a trade, but in less than two years Yerardi has earned a rep as an unusually savvy operator. "He knows what to zero in on, to focus on the issues that will make him money," says HomeVestors CEO John Hayes.

In a perfect world, Yerardi aims to buy a home a week, to own nothing for more than six months, and to earn a minimum of $20,000 per home. With the market as soft as it is, the first goal is easy to achieve. But the corollary is that it's gotten much harder to sell the homes he's rehabbed. So Yerardi and his four-person staff spend much of their time on tactics that wouldn't have been necessary a few years back—courting prospective purchasers, working with mortgage companies to line up buyer financing, and helping novice home-flippers work deals. At any given time, Yerardi typically has a dozen homes on his hands, each costing him an average of $150 a day in interest. For all his confidence, he is not blind to the risks involved. Inside his offices, he constantly can be heard saying, "I've gotta get this house off my plate."

 


 
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User Comments:

Attleboro's gamble
Posted by andrew | Feb. 26, 2008 at 12:05 PM
COMMENT:
The downtown facelift is a big gamble, but whats a better story is the rebuilding of the school system. Beyond that it has its own Zoo, art museum, the best endowed community hospital in new england, an open government. All at a real discount on real estate and taxes.
Not a gamble I would take with kids
Posted by Anonymous | Feb. 26, 2008 at 7:05 PM
COMMENT:
The Attleboro school system isn't good. There have been gang fights in the high school cafeteria and the school system has to focus it's resources on just maintaining discipline. Too close to the bad areas of Rhode Island, drug deals in the center, thugs hanging out there all hours. Not a place to raise kids.
6 Years and Counting....
Posted by J | Feb. 27, 2008 at 9:53 AM
COMMENT:
Strongly disagree with Anonymous! Attleboro schools are getting a lot better and have some of the best programs in the state. I rarely hear of violence in and out of the school system. I feel very safe here. Also, Attleboro is 12 minutes from Providence which is architecturally beautiful and culture rich so I don't know why you are saying it is near the bad parts of Rhode Island. Lastly, Attleboro is a great place to raise children. My 2 nieces are thriving and a zoo up the street doesn't hurt either. Do some research and you will find that Attleboro is not what it used to be and that is a good thing!!!
Attleboro - a jewel waiting to be discovered
Posted by Frank | Feb. 27, 2008 at 1:08 PM
COMMENT:
My wife and I have lived her for 14 years since we relocated here because we wanted to live in an old Victorian home. I am now the President of the Attleboro Historic Preservation Society and we have never regretted our moving “out-of-state” from RI. My commute to work in Providence is 10 easy miles with no traffic. Our home is a showplace which would have cost 140% more in RI and would be taxed at 4 times what we are paying in Attleboro. Our neighbors are wonderful, culturally diverse. friendly people. The neighborhood is like the Beaver’s neighborhood on the TV show except with multiple ethnic backgrounds. There are plenty of housing bargains here which will prove to be good investments in the near future. One example is an old fire station in South Attleboro that is the process of being turned into two condominiums providing an outstanding example of the adaptive reuse of older properties. The city is over 300 years old and has the potential to become a historic preserva
Believe in Attleboro
Posted by P | Feb. 27, 2008 at 3:06 PM
COMMENT:
I strongly disagree with Anonymous. My family has lived in Attleboro since 1996 and both my kids attend Attleboro schools. We are very happy in the direction which the school system and the City is moving. My children and I feel very safe here and in their schools. Being so close to Providence RI and Pawtucket RI is great as both cities offer many great restaurants. We just need a few of those restaraunts in our Downtown area
Attleboro's rich community
Posted by Roy | Feb. 29, 2008 at 7:20 AM
COMMENT:
Aside from burgeoning economic renewal, Attleboro offers a really vibrant community with many civic and social organizations, an active Chamber of Commerce, churches of many faiths, a great YMCA, senior center, quality child daycare facilities, etc. Now Britol Community College has located a permanent campus in Attleboro, opening up new educational opportunities. The future looks bright in Attleboro.
GLBT
Posted by Anonymous | Feb. 29, 2008 at 10:27 PM
COMMENT:
Great place to raise GLBT family. Very open minded families and schools.
Hull a Gamble?
Posted by Anonymous | Mar. 5, 2008 at 6:25 AM
COMMENT:
I disagree that Hull is a Gamble. It's a great small seaside community with a hotel, new condos, restaurants, great water views, a beautiful beach and easy access to the new train and the commuter boat. A lot of the homes have been renovated over the past few years so there are some beautiful homes to choice from. The view across the Hingha & Hull bay is the same view you get in Hingham with a price tag thats a lot less. The walk along the beach can not be found any where else on the south shore.
Correction to Article
Posted by Justin | Mar. 17, 2008 at 9:19 AM
COMMENT:
Our firm has conducted over 14,000 real estate auctions in MA and nationally since 1976. In a 1st mortgage foreclosure auction in MA, the buyer will be reponsible for the unpaid taxes, water & utilities (as seen on the Municipal Lien Certificate). However, as long as it's the 1st mortgage being foreclosed, the junior lien holders and junior mortgage holders get wiped out. This quote from the article is just incorrect: "Once you find a house you like, you'll need to make sure there are no liens against it—from the unpaid kitchen contractor, for instance—as those liabilities fall to the purchaser." The only time this would apply is if these liens were recorded and were senior to the mortgage being foreclosed. ie. 2nd or 3rd mortgage foreclosure. FYI...
foreclosures & liens
Posted by neil | Apr. 21, 2008 at 1:36 PM
COMMENT:
In MA all money owed to govt (so municipal taxes, waters, utilities) and any lien put on by the gov't (child support, income/irs tax liens) are superior to a mortgage. Also any condo fee complaint (lien) is superior to a mortgage. A Mortgagee can still foreclose with superior liens owed, but those liens will not be extinguished by the foreclosure, so subsequent owners are liable. Also, any lien that was put on record in the registry of deeds prior to when the mortgage that is being foreclosed was originally put on record WILL NOT be extinguished by the foreclosure. In almost all cases lenders will not give money unless all previous liens are payed off, so if you see a previous undischarged lien of record, the lien was probably settled but someone was to lazy to file the discharge. But in the rare case that lien was not discharged because it was not paid, the post-foreclosure owner will be liable.
foreclosures & liens
Posted by neil | Apr. 21, 2008 at 2:03 PM
COMMENT:
Also, liens have expiration times by statute. For example tax liens are good for ten years, attachments are good for 5 yrs 30 days, Blah blah. The point being is if you're interested in buying a foreclosed property at auction you should hire a real estate attorney (who will hire a title-examiner) PRIOR to auction in order to do your due-diligence & see what is owed. Also, the real estate law firms that handle lenders' foreclosures at auction represent lenders & not the foreclosure buyer. If you are financing your purchase you'll have your own bank's attorney verifying the title & whats owed, but if you're buying in cash (or have some non-traditional financing) you really need to hire someone that knows what their doing & will be liable if their examination of the title is incorrect & there's a lot more owed on the property than you thought.
Great Community, Good Schools, gang fights are false.
Posted by Joseph | May. 3, 2008 at 11:18 PM
COMMENT:
Hello: Anonymous: As a High School student at Attleboro and a candidate for Attleboro City Council At-Large in 2009. I have to strongly disagree with your commments. That fight, which I was a witness to: was not gang related. One member was suggested by the administation that he may have been in a gang which later turned out that he was not. The School system is very good. We have great administrators and hearfelt teachers that really care about the success of the students. So take this from someone who knows first hand. Attleboro is a great place to live. We are all a family here in Attleboro and we are all friends. Its how this parents raise the kids' that makes the difference. You can live in the best place in the world, like the nearby town of Rehoboth but if teens want to do drugs they will find a way. The new superintendent has revamped the school system over the last two years and major changes have been put into effect. So take a new look at Attleboro. We are a thriving town an
Moving to Attleboro was my worst mistake
Posted by Anonymous | Sep. 4, 2008 at 4:03 PM
COMMENT:
I grew up in Mansfield, bought a home in Attleboro b/c of lower prices. Worst mistake I EVER made. My house is locked and house alarmed is armed at all times. I live in the center of town w/ 3 sex offenders as NEXT door neighbors. I do not feel safe here. The school system is terrible here not to mention unsafe. If this housing market were better I would have moved my family out of here the night we signed papers on this house. The police are at my neighbors homes about 5 times a month, the officers show no respect to my family & I (the people they are supposed to be protecting) The Mayor is a moron. WORST mistake my husband & I ever made was moving here, the taxes and home prices here are low for a reason. Do your research, if I had done more I wouldn't be stuck in Attleboro during this bad housing market.
shame on you
Posted by j | Sep. 5, 2008 at 7:26 AM
COMMENT:
This is the most irresponsible poll ever devised. Crime soars when a town is picked for top 10. It’s almost like criminals use “best places to live” polls as a barometer to find out what’s hot and what’s not. Not to mention the fact that these statistics are completely inaccurate and can also damage home and property sales.
Hanover - great schools, suburban life with country charm
Posted by Mark | Oct. 1, 2008 at 2:31 AM
COMMENT:
I think Hanover is a great place to live. They have plenty of shopping, 20 miles from Boston, still has some country charm left and it's a safe place. It's becoming pricey to live there but still a bargain compared to Hingham, Cohasset, Duxbury or Norwell.
My favorite towns.
Posted by Anonymous | Oct. 8, 2008 at 12:10 AM
COMMENT:
My favorite towns are Arlington, Watertown, Belmont, and Melrose. But I am single guy in his 40's still renting. Winchester, Newton and Wellesley are cool, but I prefer to be closer to the activity in Boston and Cambridge.
Melrose Misunderstood
Posted by Anonymous | Nov. 25, 2008 at 9:57 AM
COMMENT:
While the review certainly boasts some quality aspects of the Melrose, it does not do justice in fully explaining the many benefits of this unique city. Untouched by highways (yet minutes from 93 and Rt 1) this demographically balanced city is easy accessible with quality and beautiful Victorian built homes and parks. Having lived in Melrose for six years I have only met quality residents who share a sense of community pride. Aside from respectable schools Melrose has its own symphony orchestra, Victorian society, and tons of community events. Anyone who does not know Melrose usually walks away surprised at the overall value this city maintains. Overall, it is undervalued and probably will peak in the future as other local towns.
Attleboro Gangs
Posted by Anonymous | Apr. 5, 2009 at 5:23 PM
COMMENT:
I attended Attleboro public schools for 12 years and I received a wonderful education. My friends and I (all AHS graduates) now attend Columbia, Brown, Harvard, BC, BU, Vassar, Simmons, PC, Bennington, NYU and many other fabulous schools (all of us received scholarships as well). People who say Attleboro is full of gangs are people who buy into the Sun Chronicle's vendetta against AHS (coincidence that the editor's children attend Feehan?). The Sun Chronicle is full of malarky; Attleboro will always be my home!
Attleboro
Posted by Anonymous | Apr. 6, 2009 at 7:48 AM
COMMENT:
My husband and I just moved to Attleboro a year ago. We are in our mid-20's and moved there because it is such an easy commute to boston, and an affordable place to buy our first home. We bought a two family home and renovated it. I cant say enough great things about our experience here so far.
Attleboro crime
Posted by Anonymous | Oct. 29, 2009 at 4:53 PM
COMMENT:
The population of Attleboro has grown to about 44,000 people. Many of the new residents moved here from larger cities in Massachusetts and Rhode Island and have brought the gang culture with them. As a lifelong resident of Attleboro, I can say that the crime rate has increased dramatically.
so - stop the crime!
Posted by Anonymous | Aug. 30, 2010 at 6:05 PM
COMMENT:
In any town, too many good people sit back and say nothing to these idiot kids who think they can run around and spray paint anything that doesn't already look dirty. SPEAK UP!! If you see it and you don't like - tell them off! Vandalizing happens in every town. It's the citizens who care enough to stand up to these unkept dopes that keep towns clean and safe.
 
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