building a neighborhood up? and interesting hypothetical.

Investor · Woodbridge, VA · Member since 2015 · 476 posts · 197 votes

So this post a purely hypothetical but what is everyone's thoughts about building a block or small neighborhood, not new construction, but somewhere like Baltimore where homes can be bought for as little as 5-10K?

If someone were to get say 8-10 of these home in a condensed area, Rehab them to slightly above the local market, no million dollar homes but nice shrubs out front and mid-ranged interiors, do you think that that would bring the market of that street up above the surrounding area or that it would end up reverting back to the way it was before?

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Gilbert Dominguez

Investor · Chicago, IL · Member since 2015 · 677 posts · 309 votes

11y

I think the kind of project you are considering or talking about might lead you to have talks with your city planning department and any neighborhood revitalization programs available. You might even find the city has some money to put into such a proposal or would work with you in other ways. Don't know until you try it. This would not be something I would just try blindly and certainly not alone.

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Kyle Gregg
Baltimore, MD · Member since 2015 · 301 posts · 82 votes
11y
if had this same idea, thinking how nice it would be to have an entire block of houses i rehabbed...turning run down blocks into nice livable neighborhoods. but then i think thatthose 5-10k houses are in war-zones. then to find an entire block of them? deep in war zones. i think it would take more than a group of rehabbed homes to increase the market and overall feel of a neighborhood. It would be a start but it would take years and years to see an increase in the market, especially in Baltimore where the market is very 'stuck in its ways'.
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Shaniqua Dupree
Real Estate Consultant · Atlanta, GA · Member since 2015 · 173 posts · 46 votes
11y
I think the same thing and think it would work if it was an area that was literally next to a block that had good profits. Going somewhere like sandtown to me would not work. Its a block of shells in the middle of a bad area. To bad most if not all of the block of shells are in bad areas. A good location in my opinion would be on broadway the same road as kennedy krieger institute. I think there are actually some shells over there. Its broadway and north ave. Its best to build up the established neighborhood imo and then g ok to the vacan blocks.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
11y
Same could be said for Harrisburg or philly.
If you got a groups of 5-10 developers and did several blocks in a non-war zone it could work as part of a revitalization plan.
If it were ever to be done you would need city help/involvement as well to get their buy in on the project which would eventually lead to more police patrols = lesser crimes
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Gilbert Dominguez
Investor · Chicago, IL · Member since 2015 · 677 posts · 309 votes
11y
I think the kind of project you are considering or talking about might lead you to have talks with your city planning department and any neighborhood revitalization programs available. You might even find the city has some money to put into such a proposal or would work with you in other ways. Don't know until you try it. This would not be something I would just try blindly and certainly not alone.
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Kevin Harrison
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Investor · Woodbridge, VA · Member since 2015 · 476 posts · 197 votes
11y
Like I said this is just a hypothetical right now but I think your right about the city getting involved. That was something that I thought about after I posted this yesterday. I bet even if the city couldent commit money to this, if done in the right area the city would be willing to provide some more police patrols and possibly some help in the obtaining of permits. Anothing this I thought about was that to do this you would have to get some business involved, something to draw people to the area, IE. places to eat, convience stores, and shops ETC.
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Bill Struthers
Accountant · Baltimore, MD · Member since 2015 · 20 posts · 8 votes
11y
I've thought about this concept at length. Baltimore seems like a great town for it. Improving property values for neighbors, building equity for yourself, providing a safe area for tenants, etc. It seems to be a win for all.
I'm trying to do this on a small scale myself in Pigtown. I'm buying my second home on the same block. Then I'll pick up trash, see about getting city trees planted, and improve curb appeal on both homes.
Cheers.
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Karen MargraveBusiness Member
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Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
11y
Real estate prices are driven by SUPPLY and DEMAND. Demand is brought about by lack of supply for housing in an area. Demand is usually, at its core, driven by something in the area that is changing. (an improving economy due to manufacturing booting up or expanding, etc., in resort areas - an improving economy bringing tourists, back, etc.)
Questions you need to ask yourself.
1. Are those that are currently living in the neighborhood living below their means, but can afford to pay more for purchasing a home or monthly rent?
2. Is the local economy on an upswing where new people will be drawn to the area, creating more demand?
3. Who would the potential buyers/renters for the newly rehabbed homes be?
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Kevin Harrison
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Investor · Woodbridge, VA · Member since 2015 · 476 posts · 197 votes
11y
@Karen Margrave there is a large portion of the population in Baltimore that is strictly renters but most of them are not the type of tenant I would be looking for. I think the biggest market the area is missing is the starting out professionals, IE mid 20's to early 30's, who aren't ready to buy yet be end up renting outside of the city due to it either being too expensive for a decent area or the areas being war zones. I think something near amenities where there could be a B-ish neighborhood built. I think finding the location would end up being the key to making something like this work.
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Richard C.
Bedford, NH · Member since 2012 · 2k+ posts · 1k+ votes
11y
You would need a very small grouping of houses, with some clear definition/divide from surrounding blighted areas, and some sort of draw. Riverfront, transport link, something.
And the buildings themselves would need to be both interesting and not too large. Families aren't going to move in as long as the schools are awful, so you would be targeting young professionals.
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Kevin Harrison
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Investor · Woodbridge, VA · Member since 2015 · 476 posts · 197 votes
11y
@Liz Sickenger I will most likely not be reaching out to the city officials, not because I don't believe in the idea but simply because I am a new investor and do not have the capital to do this properly. Hence the reason its a hypothetical. lol. But I do think this would be a feasible idea in the future, and I wanted to get everyone's input. Far a larger investor that is well established this idea would be a lot more likely to succeed. Most likely with private money, because I don't know of a bank that would lend you the $300K or so needed to get the properties and do the rehab, especially without a proven track record. So for some one like me with only a couple of properties under my belt, not so much.
@Richard C. I was thinking the same thing a far as amenities go, most likely place would be to find a run down block that is already near the main interstate, possibly a train station, and that already has some amenities such as 7-11 and fast food even if they are not the type of business we hope to have there in the future. It might even be a good play to try and buy the commercial properties near by and start shopping them around to the business we want at a discount.
Its a big circle, you have to have the people to draw the businesses, but you almost need the businesses to draw the right kind of people.
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