One of the most lucrative investment markets in Maryland is the Baltimore real estate market. Baltimore is one of the oldest communities in the United States, but it also offers some of the lowest house prices when compared to other major cities in the country.
In fact, house prices in Baltimore are around 40% less expensive than the prices in Washington D.C. So, real estate investors who are looking to invest in rental properties within the Baltimore, Washington Corridor can find many lucrative opportunities.
But if you are planning to buy an investment property in the Baltimore real estate market, you have to act fast because homes in Baltimore are selling quickly. As a matter of fact, properties are selling at an average of two weeks in Baltimore.
At American Dream Realty and Management, we believe Baltimore MD is a great location to buy an investment property, and here is why:
Variety of Unique Properties
In Baltimore, row houses with colonial influences are still readily available. But people who want to buy an apartment, condo, or studio can still find many options in Baltimore’s various charming neighborhoods.
What’s more, these neighborhoods themselves are unique and ideal for quality living. You can also find properties on the waterfront if the price fits your budget in the Baltimore housing market.
Growing Job Market
As Baltimore is near Washington D.C., Baltimore city has enjoyed a huge share of federal investment over the years. Meaning there are many new job openings for different sectors like construction, manufacturing, trade and transportation, and financial industries.
Another factor that contributes to the strong job market in Baltimore is that it is home to a variety of federal agencies, such as the Social Security Administration, the U.S. Cyber Command, and the National Security Agency.
Steady Property Appreciation Rates
With a strong property appreciation rate in Baltimore, investors, real estate professionals, and homeowners alike will see a substantial increase in their property values after just a few years. Investors who plan to sell their investment homes in the future will definitely gain significant profits with their Baltimore real estate investment.
Affordable House Prices
While home appreciation rates are steadily increasing in Baltimore, house prices are still among the cheapest in the United States. While there are home values at over $1 million, especially in the northern and southern portions of Baltimore, homebuyers and investors can still find homes for around $200,000.
Real estate investors of any budget can find something to fit their desired purchase price in their prefered Baltimore neighborhoods. The property taxes are also quite reasonable, boasting a truly affordable real estate market.
Many Recreational Activities
Baltimore, MD is known for its sports activities – especially Football. Residents flock to see the Baltimore Ravens play but the proximity to DC also allows people to visit the Washington Nationals Hockey team.
Aside from sports, Baltimore also has a rich history and culture. Residents get to explore historic sites. These recreational and entertainment activities are a few of the reasons why Baltimore is also a great tourist destination.
How to Find the Best Investment Properties in Baltimore
If you’re planning to invest in Baltimore property, it’s essential to keep these tips and tricks in mind:
Plan Your Budget
Before buying an investment property, it’s essential to plan your budget ahead and make sure to stick to it. Failure to set a budget beforehand may lead to unnecessary overspending in the real estate markets.
If you’re buying a rental property, make sure that you’ll only spend what you can charge for. You don’t want to end up having a negative cash flow after paying your mortgage and other monthly expenses.
Find the Right Location
While Baltimore is a great place for investing in real estate, it’s important to note that not all neighborhoods in Baltimore are optimal for rental properties. To ensure profitability and maximize your home values, you have to know how to find the right location for your investment.
Take the following factors into consideration when choosing the best areas in Baltimore:
Safety: If you want to attract tenants, you have to ensure that your area is safe and secure. No one wants to stay in a place that’s dangerous and has a high crime rate. Verify the crime rate in a neighborhood and check to see that it is not isolated or abandoned.
Amenities: Depending on your target market, a neighborhood’s amenities may greatly affect how appealing it would be to renters. For instance, if you want to rent it out to families, you have to make sure that there are schools in the cities close by.
If you want to rent out to professionals, make sure that public transportation is available and that the area is near business districts where people go for work. Other important amenities to look at are shopping centers, dining, recreational facilities, medical services, and supermarkets.
Demand for rentals: Some areas, no matter how wonderful they may seem, are just not good for investing in rental properties because there is no market demand in that location.
Buyers need to ensure that there is sufficient demand for rentals in your chosen neighborhood, make sure to study and analyze rental comps to check the occupancy rates of similar rental properties in the same area.
Renovate the Property After Purchase
To make your property stand out among the competition, you have to ensure that it is in top condition. When you buy a rental property, it will most likely need a few renovations and improvements to make it tenant-ready. Keep in mind though, you have to stick to a budget when making home improvements.
SomeBaltimore buyers fall into the trap of going overboard with their renovation expenses. While improving the property can increase its value, it’s still best to stick to what is necessary and be prudent when it comes to spending.
Bottom Line
There are many reasons why an investor would choose the city of Baltimore for a real estate investment. It could be the strong economy, the low house prices, or the proximity to the nation’s capital.
In any case, if you have any questions about his or any other aspect of property management don’t hesitate to contact us at American Dream Realty and Management.