Lender · Baltimore MD · Member since 2015 · 202 posts · 67 votes
Hey guys,
Recently I've been coming across some houses in neighborhoods that don't have a ton of recently sold rehabs. Should this be a warning sign as it's not a great neighborhood to rehab/ wholesale in?
I live in the Washington DC area which can be pretty spotty and have some fluctuation neighborhood by neighborhood so I'm hesitant to go too far away from the subject property. Any DC investors find this problem in parts of NE and SE/SW? Do you just expand your search?
Because I am door knocking, I pre-analyze close to 10 homes a day and rather not continually ask my realtor to run comps for me, with little chance of actually closing a real deal.
Yes there are a couple spots around DC that have spotty sales comps (sometimes none in the previous year, within 10 blocks). Be really careful in those areas because out sale is probably going to be significantly lower than other areas. Plus time on market can go on forever. Good for wholesaling (quick purchase agreement) but bad for resale time (and investor will want a lower cost).
We've found there are lots of vacant land opportunities in these areas and the lack of comps really drives down what we can pay for raw land. Still not bad areas to buy in because essentially they are like secondary markets close in to DC.
Some other things to consider in purchase price is the fact an investor will have to hang on to those properties longer because of the low amount of buyers looking in those areas. It's not your typical DC fix and flip and in and out in 4-6 months. So cash outlay will be longer = more $$.