Investors in Hyattsville/College Park Maryland area?

Question

My wife and I live in Washington, DC, and we're in the process of researching markets nearby to begin buy and hold investing, most likely SFH. So far we've just been renting out our basement apartment unit in the city (which has worked out very well) but we want to buy a second property in 2015 as an investment. One of the areas we've been interested in is the College Park, Hyattsville, Riverdale region... It seems to be one of the few spots within the beltway with reasonable prices, and given all the new development and the University of Maryland nearby it seems like an ideal spot for a rental. I'm familiar with the area, as I used to live in CP, but am looking to network with some folks actively investing there now. Who out there has been buying in the area?

Russell Brazil · Answer

@Brandy Tingen mentioned maybe the multi families in Takoma Park. I would probably shy away from those for a couple reasons.  Takoma Park has rent control if you have two units or more.  So if you buy one of those 3/4 unit buildings and live in one, you are hit by rent control right off the bat.  Also as is typical with rent controlled areas, peoples houses tend to not be upkept well, which you see in the part of Takoma Park where those are.  The other thing is most of those Takoma Park multis are lead paint houses, so there is that headache to deal with.

@Kenny Fletcher

In PG county you do have the tenant friendly laws that can really drag an eviction out....but if you are screening your tenants properly, hopefully you dont run into that problem.  It will still be quite hard to hit a 1% rule in descent parts of PG county.  You can hit 1% or higher if you go to the southern part of the county, but those will be in some rougher areas.

If you are looking for cash flowing properties, you might want to consider Frederick County and Baltimore County....though you wont get the type of appreciation you will get closer to DC.

@Kenny Fletcher...what part of DC is your primary residence in? (Keep in mind in DC after you hit 4 rental units you are subject to rent control)

Richard Bailey · Answer

I see that your last post was a little old, but I was wondering if you ever purchased any property and Prince George's County as of yet?

Kenny Fletcher · Answer

@Russell Brazil  thanks for the insight on Takoma and PG, and for bringing up the issue of rent control. My primary residence in DC is a few blocks north of the GA Ave/Petworth metro stop. We've also considered purchasing something in the Baltimore area or parts of Southern Maryland, but that would be a different strategy: I have work in DC so it would not be a primary residence, and we'll have to look further into financing options for that.

Ray Browne · Answer

Kenny, you need to be very careful in PG County regarding lag time on evictions and general tenant friendly laws.

Some of this is mitigated if you are willing to pay the premium to be extremely close to the university so that your rental primarily attracts students , freeing you from any discrimination issues re. tenant selection further away where you'll have a lot of non-students vieing for your property as well.

If your not planning to renovate the property extensively you may find it hard to move it when you are ready to move on, with a continuing supply of new construction coming online in the county it can be hard to find a buyer for an older worn property.

Derald Everhart · Answer

@Kenny Fletcher

Welcome to BP.  I live in Hyattsville and am looking to find a quad this year as a investment.  I'd be interested in hearing about what you've found.  Cheers.

Kenny Fletcher · Answer

Brandt, thanks for the tips. At this point it's just my wife and I, so we've definitely considered buying a duplex to quad to live in for a year or two and get owner occupied financing. It all depends on if we can find the right deal. Takoma Park is a really nice area convenient to so much... Let's definitely keep in touch!

Brandt Tingen · Answer

How many people are in your family?  Would owner occupying a triplex or a quad in Takoma Park or NE be a possibility if it were a 2 BR unit, or would that be too small for your family.  The podcast episode 86 with Cory Binsfield has some unique insight on renting to college students.  You may want to reach out to him and ask to pick his brain.  I hadn't really thought about this as an option, but this could be a great idea.  I have been looking in Takoma Park for a quad, but this is only another few miles out.  Let's keep in touch with this thread as we study up.

Kenny Fletcher · Answer

I had not taken into consideration the tenant laws when thinking about that area, good point. I know Maryland has a tenant-friendly bent, but is there anything specific to PG that I should be aware of vs other parts of MD? Is DC much better for landlords as far as tenant laws go?

One area we've been eyeing is Riverdale Park given the new development going in there anchored by the Whole Foods and the fact that the commute into DC isn't too bad, especially with the MARC. A strategy we've been considering would be to buy a place in PG as our new primary residence and rent our house in DC (which would have great cash flow). We'd hold onto the new house in PG for a year or two and renovate it, at which time we could move on to a new primary residence and either sell or rent the PG house depending on the market. I'm assuming that in that area it is close enough to UMD that we could market to that crowd if we decide to rent. Ray, I hadn't considered your point about the new construction and that's giving me something else to think about.

We're really just starting to learn about our options, so it's great to be able to bounce ideas off here.

Andraise Scott · Answer

Hello Kenny,

I am in that area and used to live in CP as well.  CP and Beltville are part of my target area as well.  Are you thinking about a college student rental?  Or, just regular SFH's?

Jesse T. · Answer

I am from Prince George's County(Landover) originally.  My brother is in Cheverly.  The numbers do look better in PG County vs. other areas around DC.  I haven't looked much in MD because I am concerned about the tenant friendly laws and the distance during rush hour.

Investors in Hyattsville/College Park Maryland area?

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