All Forum Posts by: Nicole Blankenship

As has been stated about Baltimore I would consider it.  You can get always get a decent single family for around that in a B grade area that is relatively turnkey and mught be able to get a duplex with 2 1 bedrooms as well.  With closing costs and very minor startup stuff it would be possible.  The most important thing is to pick the right asset class.  With Baltimore you can be there for showings to ensure that.  I think me and most people are fairly honest here but after a while of you get some agent working remotely fit you they will just want you to buy something so they can get paid.  If you invest somewhere you need to fly to it might not be good if you have to fly there a few times.  I'd recommend at minimum for the inspection.  Another thing is if it's Baltimore you could save on a pm charge which could save you a lot of cashflow or maybe leasing though with that I would really consider your time.  I have worked with other investors in the DC area and its worked for them.  They purchased B grade stuff which for me means you can get someone with a 700 plus credit score who always pays on the 1st and you lose no piece of mind about that.  If you go into some midwest C grade asset where that can't happen you have a high likelyhood ofmuch more stress.  Furthermore if things break and you are only in Arlington again you might not need a pm but if it's way out in Ohio or Michigan having a pm makes sense. Than deduct the pm fee and there could go your cashflow.  Also if you have a mostly remote job you could have it be a primary residence and be in a great part of town and have a roommate where they have the basement with their own entrance and live in a great part of town so you would attract young professionals or maybe a duplex for that.  

How exciting! 

My 2 cents about asking a Realtor for advice on locations to purchase, DONT DO IT! You need to do the research yourself. Like everyone else said to be careful where you choose. If its your first investment I would chose as close to you as possible.

I would start first with figuring out what are your lending options. That will narrow down your budget because some loans require more or less down. So knowing those numbers first can help you focus on an area.

To focus on an area I would look into areas with a large Military population. They are great to work with. Also maybe consider areas with a large retirement population. They have consistent income and most likely will stay in the home for a long period of time if not forever.

DSCR which in my opinion is a great option.There are stipulations but it's a pretty streamline process and easy to follow. If you're going hard money the thing to know is that hard money lenders will charge you anywhere from 10%-15% or more and require you to refinance the loan in less than 2 years. The issue you run into hard money is what if the price depreciates buy the time you refinance you might be sp a creek with no paddle. I would go the DSCR route.

Let's say if I have $40k to use and decided to use the DSCR loan option I might be able to acquire a $250k loan. That's using all of the money allocated for the purchase. You might need some reserves for any repairs needed and lending requirements.

@Nicole Blankenship

welcome.  i lived in Northern Virginia for 16 years and still own property there, so i totally understand the desire to find a lower cost market to invest in.  I want to strongly caution you, though, to really do thorough due diligence.  a lot of investors in DC, CA, etc. find a property in the midwest that looks great... and then just turns into a money pit, and deferred capex consumes years and years of cash flow.  and with the jump in interest rates cash flow is even more challenging at the moment.

as an example... see this really thoughtful thread.  i'd argue this investor did everything right... and the cash flow just wasn't as much as hoped for, because the midwest is not a panacea.

https://www.biggerpockets.com/forums/48/topics/1159104-overl...

and unfortunately... if you're looking for something turnkey, $40K just isn't going to get you very much.  you might get 1 property in a decent neighborhood... and then be at about break even on cash flow each month.  i just don't see how that's a good use of your entire RE budget, and/or liquidating other investments to not get a return.

i am encouraged that you said that you plan to fly to the chosen market in person, but one or two trips just isn't going to get you very much.  have you considered house hacking?  it's tougher in the DC metro because of the lack of small multifamily so you'd be looking at roommates.  another option is to pick a DC exurb like Hagerstown or Culpeper or Winchester or even the nicer areas of Baltimore (get some local experts to guide you if you go that direction) and start going there every weekend and really put some time in.

hope this helps, feel free to ask any follow ups or PM me