East Baltimore redevelopment

[Gayle Melnick]

For everyone here that lives or invests in Baltimore city, what do you think of the East Baltimore redevelopment? 

https://www.bizjournals.com/ba...

Broadway East and Oliver have a ton of vacant buildings and generally a lot of crime. Do you think the state pumping money into the area will result in a real revitalization of the area? It looks like they're rehabbing a couple of old vacant buildings and bringing some new jobs to the area. 

I'm looking at redfin and zillow in these neighborhoods and you see vacant, trashed buildings listed for sale for $5-50K next to fully rehabbed houses at $150-200k.

There's definitely rehabbing going on in this area, I'm wondering if anyone on here is actively flipping in this area? 

Does anyone have any experience with the city's "Vacant to Value" application process?

I'm very new to real estate investing. I'm buying my first two rental properties that just require small cosmetic rehabs in Charles Village and Dundalk closing next month. I don't have the capital to try to get involved with a flip right now, and I'd be hesitant for my first flip to be in an area that seems like a lot of speculation rather than in an established neighborhood, but I'm just curious if others on here are taking a look at this area.

[Alan C.]

I would agree that doing flips in this area is a bit speculative. There is similar activitya few blocks away over by the Hoen Lithographic Building on East Biddle. Vacant properties can be had for less than $20K and some rehabbed properties are then selling for as much as $150K. But it's still an area in the early stages of transition, so in my mind you need to know that your investment may not pay off if the development stalls.

There were big plans for East Baltimore development around Hopkins Hospital in the early 2000s and people were selling or trying to sell shells for up to $50,000. Then the recession hit n 2008 and everything came to a dead stop. Things have resumed at a slower pace and eventually the area will come around. 

I think we're in for another recession that is going to be as bad or worse than 2008. If you see who is funding this project, it's almost all government or non-profit entities. Their money is probably going to dry up as the effects of the lockdown, moratoria and forbearance problems. Again, the projects will slow or stop, but may pick up again some years later.

I'm pretty conservative in my investments, so I stay away from areas like this, but there are lots of more adventurous (or desperate) people who will take more risk and suffer the losses in return for some big profits.