All Forum Posts by: Jasmin Mcduffie

Dear BP I'm a newbie looking to buy my first investment property. Recently I've found some great homes that appear to be in good shape functionally (newer HVAC and solid roof /structure) but don't have the aesthetic "sexy" curb appeal. For example the kitchen and bath fixtures are operational and work but look a bit dated. The basement is functional as a family area but has old tile flooring and exposed beams / piping. If everything is in good working order is it worth making upgrades to kitchen and / or bath finishes to appeal to potential tenants? Is it worth it to "finish" the basement with drywall walls and a ceiling to make the space feel more like a family space and less like a basement? Financially it seems like it would be best to start with what's in place especially if it's rent ready and everything is good working order and lower the rent to accommodate the dated fixtures and finished. I often wonder however if the place looks dated will tenants treat it like it's dated... If it looks shiny and new will a tenant treat it better... Thanks JASMIN

Hello BP Still on my RE journey and found a nice property in Belair Edison near Clifton Park Golf Course. The neighborhood seems really nice and the homes are well kept. Seems like a nice neighborhood for buy and hold if the numbers work out. Are there any investors with experience in this neighborhood? Thank you JASMIN

Thank you for the great feedback. I'm looking to use a conventional loan so the home has to be livable / pass inspection criteria for the bank. I'm definitely looking for class b/c rentals and don't want to start my investing career in a war zone.

Hi BP I've spent the last month visiting Baltimore (get to know the city), looking at the MLS nightly, visiting properties, running numbers, and talked to one PM company and insurance co to get a feel for good rental areas and cost of insurance. While my Baltimore experience is limited, I've started to compile a list of observations / received feedback and welcome any feed back/ comments. I'd also like to share my numbers on a property I found for input My Observations / feedback received from PM & Realtor: Property taxes are extremely high in the City (yes I was warned). They are so high that the 1% rule or the 50% rule for expenses is too low. High Property taxes make most "turnkey" type properties in relatively nice areas not cash flow. Areas I've been looking at are Baltimore Highlands, Pigtown (block by block basis), , highland town. I focused on this areas because they have some properties in my price range (less than 120k) in what appears to be B-C neighborhoods. I also want to buy something relatively safe for my first deal and want to try to avoid section 8 in this one. Once I get more experienced I may widen my focus. Focus on Baltimore County. I'm a city girl and I have to get it out of my head that just because I live in a city doesn't mean I need to buy a rental in the city....more of an internal struggle. Halethorpe over Dundalk (better rents and property values)? With cash flow as my objective I'm not sure this advice is relevant/ important. Property Analysis: Property cost: $98K Gross rent: $1,100 Operating Income: $1,012 Expenses: $428 ( includes repair/cap ex, property taxes, insurance, and PM). I used 1% of purchase value for maintenance and another 1% for cap ex. Pm is 8% of rent and insurance is estimated at $67 month Mortgage: $397 CF: $187/month 10% Cash on Cash 7% Cap rate I'll put 20% down +$4k closing. Property is move in ready. New kitchen and HVAC systems. The neighbor was home when we visited the property ( homeowner who's been there 30y) he thought they cut a few (minor) corners when the renovated the roof over the covered porch. This was one of the first properties I visited and my realtor wanted me to take a second look at it (month later). The numbers appear good..to me as a newbie. There is an identical property across the street for rent (listed for 1200/m). It's been listed since the first time we visited over 30 days ago. I looked st the photos and it also has new kitchen with SS appliances. I plan on calling the PM on the listing to find out the scoop. I understand it may be harder to rent this time of year but that length of vacancy bothers me and is the reason I lowered the monthly rent in my analysis by $100. I'm ready to act but want to make sure I'm not over looking something or developing analysis paralysis. My biggest fear is vacancy. For Baltimore investors what vacancy rates / time tables are you experiencing? Help Thank you Jasmin

There are walk in tub / shower combos if your interested in accommodating them and want to keep a tub for future tenants. The tub has a swing door that allows you to walk in and seals when using the tub feature. Wasn't sure how to post a photo but google them for more info.

Hi I'm new to real estate investing and haven't purchased my first property yet but have started the process and want to look into property management company's. Are there any PM you would recommend that serve Baltimore and why? Thank you Jasmin

The advice is awesome thank you. The idea to talk to PM to get a feel for rental areas is great and I plan on doing that in the next couple days. First to get a feel for the rates and terms and to ask about rental areas. Good point about driving at night. I've been looking at the crime data and plan to analyze that as well. I'm starting to analyze deals just to get a feel for it and to check my budget / assumptions/ ROI. Below is a sample based on a real property and quoted loan terms. Any and all comments are much appreciated $68,900. Asking Price $13,780. DP (20%) $5,690 Closing Cost - includes (3k escrow, 1,800 Title etc, 799 origination fee) 55,120 loan Amount 4.5% int rate 1,200 - rent per research ( add states already a tenant on month to month lease) 279.00 mort 261.00 taxes (estimate 3k taxes for 2015) 80 insurance (estimate) 120 PM (estimate) 100 vacancy 100 maintenance $259.72 cash flow 13% return from $19,470 cash out of pocket Did I miss anything. Any red flags in this analysis? Thank you

Thank you for your responses. I really appreciate the assistance. I would like to find a deal that is under 100k. I based that figure on what would be my out of pocket expenses for a conventional 30 year fixed loan and what the monthly mortgage would be if I had to pay it out of pocket during vacant periods. Ideally I'd like to find something far less than that, say no more than 70k. Using Zillow and other online resources it looks like this may be doable. My points of concern are finding deals with these price points in areas where I can also get a decent tenant. I'd say My biggest concern is having good tenants to choose from and having a low vacancy rate for the life of the property...which is the number one factor in setting my budget. Worst case I want to be able to pay that mortgage without tapping into savings/ retirement accounts. Any thoughts on this budget and vacancy concerns is much appreciated. P.s I haven't found a real estate agent yet. One of the lenders I contacted put me in touch with a local agent. She has experience with Baltimore but not much with investors. She does have colleagues she can tap for info. Would the lack of investor experience be of concern to anyone? Thanks in advance Jasmin Jasmin

Hi I'm new to real estate investing and haven't purchased my first property yet. I live in DC and the prices here are expensive for buy and hold property so I've started looking at Baltimore. It's close to me and seem to have a number of less expensive properties. I'm not familiar with the city and have started to research areas and visiting on the weekends Is there anyone investing in Baltimore that has recommendations for areas to focus on / areas to avoid? Any recommendations for real estate agents familiar with residential investment properties? Thank you Jasmin

Hi I'm just getting started and want to buy my first rental property. I live in DC and the prices are through the roof. For that reason I am considering Baltimore MD since it's close and they have reasonable priced properties. Since I'm not from there I've started researching areas and visited this past weekend with plans to go back this weekend and get to know the city better. Are there any investors with property in Baltimore? Any areas that you would recommend? Any realtors you'd recommend who are good with passive income properties? Some deals seem too good to touch ( sketchy neighborhoods?) any advice or experience in Baltimore would be much appreciated. Thank you Jasmin