Hi @Carlos Toussaint! I’m actually responding to your post visiting your market (at the Margarittaville in Hollywood) for the weekend, but I live in and do business in Hampton Roads. I do own and manage in Portsmouth, but will not buy any more rentals there for many reasons. Norfolk is by far my favorite city in invest and do business in. I have posted on this topic before, but can’t figure out how to find it in my BP posts, so I will try to remember them all here.
1) Property tax rates are the highest in Portsmouth of any city in our region.
2) It is expensive to get to Portsmouth from our other cities because of the tolls, and PTown (what locals call Portsmouth) is threatening to raise tolls again.
3) Financially, the city makes irresponsible choices. They are always low on funds, yet this December they announced that because they had a budget surplus they would give every full-time city worker a $1,000 Christmas bonus. No money went to cops or teachers - just government workers.
6) Portsmouth has ridiculous policies that make it difficult for real estate investors to do business. They literally hired a team of 7 individuals (one of whom I rent to) who do nothing all day but drive around their assigned areas looking for grass violations. The city gives you one warning per year and if there is a second violation of grass being more than 10 inches, they will cut it and send you a $280ish bill. Yes we can pass this bill on to a tenant who was responsible for grass mowing, but who can afford to pay this for a minor offense?
7) If you decide to accept a SEC 8 tenant in Portsmouth you have to get a required city inspection (cost is $40) and then an add’l SEC 8 inspection. The Housing Authority won’t give you a final acceptance of your rent amount until after you have passed both these inspections. I have a big problem with that, and have expressed my opinion. The Housing Authority director claims that all of the other HAs in our market are doing it wrong, and Portsmouth is the only one doing it right. HUM...
I could go on, and on, and on about why Portsmouth is on my no-buy zone list.
@Carlos Toussaint Whats up! The rental market here in Virginia is great. Norfolk, Portsmouth, Chesapeake, Va Beach, Newport news, the whole hampton roads area is a hot market a lot of military. when ever you come up this way give me a shout lets meet up. I would also say single family is more popular. Look forward to talking with you !
Between Norfolk and Portsmouth, Norfolk gets higher rentals on average. Depending on where in Norfolk, determines whether a single family or multi family is better. If it's near the University or the Medical school, you'll get a higher return on a multi family property. Other areas in Norfolk a single family home will do well. If you have any other questions please let me know and I'd be happy to answer them for you 👍
@Carlos Toussaint
A lot of good responses already. Great market to invest in due to the military, universities and steady job market. More opportunities for sfh investing but with the right connections, there are opportunities for mfh investing. Just do your research on neighborhoods and because they can switch from B-C-D quickly, esp in Norfolk and Portsmouth. Good luck and hopefully we will do business together.
Small multifamilies are pretty expensive right now. Most of the turnkey quads on the market are priced around $250k and don't provide very good cash flow.
Hi @Carlos Toussaint! I’m actually responding to your post visiting your market (at the Margarittaville in Hollywood) for the weekend, but I live in and do business in Hampton Roads. I do own and manage in Portsmouth, but will not buy any more rentals there for many reasons. Norfolk is by far my favorite city in invest and do business in. I have posted on this topic before, but can’t figure out how to find it in my BP posts, so I will try to remember them all here.
1) Property tax rates are the highest in Portsmouth of any city in our region.
2) It is expensive to get to Portsmouth from our other cities because of the tolls, and PTown (what locals call Portsmouth) is threatening to raise tolls again.
3) Financially, the city makes irresponsible choices. They are always low on funds, yet this December they announced that because they had a budget surplus they would give every full-time city worker a $1,000 Christmas bonus. No money went to cops or teachers - just government workers.
6) Portsmouth has ridiculous policies that make it difficult for real estate investors to do business. They literally hired a team of 7 individuals (one of whom I rent to) who do nothing all day but drive around their assigned areas looking for grass violations. The city gives you one warning per year and if there is a second violation of grass being more than 10 inches, they will cut it and send you a $280ish bill. Yes we can pass this bill on to a tenant who was responsible for grass mowing, but who can afford to pay this for a minor offense?
7) If you decide to accept a SEC 8 tenant in Portsmouth you have to get a required city inspection (cost is $40) and then an add’l SEC 8 inspection. The Housing Authority won’t give you a final acceptance of your rent amount until after you have passed both these inspections. I have a big problem with that, and have expressed my opinion. The Housing Authority director claims that all of the other HAs in our market are doing it wrong, and Portsmouth is the only one doing it right. HUM...
I could go on, and on, and on about why Portsmouth is on my no-buy zone list.
We own a couple of MFH’s in Norfolk. One in a lower-income area, and one in a slightly higher income area. The former was a great deal, was a fixer-upper, and is returning a decent profit. As long as you do serious tenant pre-screening and have a solid property manager, buying something similar could be a good idea. The latter, we are house-hacking and LOVE living in, but it was not the best deal —owning near the river leads to high flood-insurance that really eats at our profit margin. Because of insurance cost, the house was slightly discounted (and move-in ready), but I generally have found that MFH’s in a decent area are way overpriced in Norfolk. I agree with Patti ☝🏼 that Portsmouth is less desirable to purchase buy and hold in.
@Brittany Regts - Have you heard of Mike Vernon? He is our local flood insurance expert. He sells flood insurance, teaches agent CE classes on flood, and most importantly, owns a flood mitigation company that recommends alterations to your property that significanty reduce your flood insurance premiums. As long as you are not on a crawl, it is highly likly you can make some alterations to reduce your risk, and thus your premium. Here is an article the paper wrote about him in the paper a few years ago. https://pilotonline.com/business/consumer/article_a1b8ddca-3e53-5d0f-b906-ff625de245cb.html