All Forum Posts by: Ryan David

Russell - very curious about this so wanted to follow up. What source are you using to verify a multifamily use is permitted by-right in Baltimore City? 

 Hi, Russell. What’s your source for that? I searched for a license at that property and didn’t find one. 

For anyone that followed this thread and is still interested, I'm fairly confident that this it the property the OP was referring to:

1501 Jackson St, Baltimore, MD 21230 | MLS# MDBA549216 | Redfin

Nothing is a given in this market, but in normal times this would easily be overpriced by $100K. It does NOT have a multifamily license as far as I can tell, so you can almost completely discount the duplex strategy unless you're very well connected and think you can get an ordinance through the City Council. As far as SFH comps, a 3 BR/3.5 BA complete gut reno one block away sold last month for $525K. That also seems extremely high given the midrange finishes, but it's 250 SF larger, has parking and a rooftop deck.

Anyway, the upshot is that I think the OP dodged a bullet on this one, but only time will tell.  

Closed about a month ago at 3.625%. Three unit residential mortgage, 25% down, no points, 30 year term. 

I live on the other side of Riverside Park, so I'm very familiar with SoBo/Riverside/Locust Point. Riverside is one of the higher-income neighborhoods near downtown (along with LP, Fed Hill, Canton, Fells, and Harbor East). You didn't mention the actual block, but certain blocks of Jackson St are particularly desirable (1600-1700 blocks). The area is stable, so you're not going to see crazy appreciation/growth in the coming years, but you'll have steady interest from folks looking to rent. Yes, the rental market is good, but that side of the park is much more family-oriented and a bit older than west of the park. My sense is that you'll need to do a quality rehab - of the 4 BR at least - to be competitive in the market, or you'll need to be willing to accept below market rent. Parking is very important in this part of Baltimore, particularly for families, so any off-street parking is valuable. One thing I didn't see others mention is the need for a non-owner occupied dwelling license. If it's legally just a single family home, it's a challenging process to convert to a multifamily in R-8 requiring a city ordinance. 

SUBTITLE 7
RESIDENTIAL CONVERSIONS
§ 9-701. Where allowed.
In the Residence Districts, the conversion of a single-family dwelling to a multi-family dwelling
is allowed only in the R-7, R-8, R-9, and R-10 Districts, subject to:
(1) the requirements of this subtitle; and
(2) in the R-7 and R-8 Districts, conditional-use approval by Ordinance of
the Mayor and City Council.

Hi Alice,

I actually live in Federal Hill - yes, we're yuppies - and am also contemplating the AirBnb route, so I thought I'd chime in. 

I'd stay away from condos if you're thinking about selling in 3-5 years. From what I've seen in Baltimore, they just don't seem to hold their value in the short term. This is obviously anecdotal, but I tend to see condos sit on the market for much longer than the average SFH in those neighborhoods. We're actually thinking of purchasing a condo for AirBnb, but this is mostly because we're more interested in cash flow and putting it on "autopilot," not so much appreciation in the short term.

We have some friends in the neighborhood that do quite well with Airbnb, and they seem to get most of their business from convention attendees. So I think you're on the right track with Fed Hill, Fells, and Ridgely's Delight (Camden Yards). I'd also throw in Otterbein, which has some affordable townhouses that might work. Barre Circle could work too. 

I hope this is helpful. Feel free to reach out with any neighborhood-specific questions. Good luck!

I'm currently looking to do the same with a house in Hampden. I'd be interested to hear how it works out!

Terry, no offense, but this didn't sell for a reason. It's an ugly building that doesn't fit in with the aesthetic of Kalorama and was overpriced by at least 7MM. I can see you're from California and I don't know what your role is in the deal, but I would strongly advise you not to waste too much time on this. I work in multifamily acquisitions and NOTHING trades for $950,000/unit. Even if these were huge luxury turnkey units in Dupont Circle or Georgetown that a buyer could seamlessly convert to condos and sell off, there's just no room for a profit anywhere in that universe of price. 

Again, not trying to be malicious. Just don't want you to waste your time. 

I agree with you 100%. TOPA rights are very important, but when we're trying to acquire a multifamily and one tenant is holding out for $50k to forfeit their rights and vacate, I'm guessing that's not what the council had in mind when they passed it. 

Any flexibility on price?