I had a question regarding Remote land-lording in Virginia. I currently reside in Northern Virginia, but I am looking to invest in an area where the housing costs are lower. I spent time in the Navy and I know that there is a lot of traffic of people in and out of the Hampton Roads area each year. I was wondering what some of you think about remote investing in that area. I am not far away if anything goes really bad, and I have worked it in my plan for 15% for a Property Management company. I have done a lot of research as to plumbers, carpenters, HVAC pro's, etc. Does anyone have any experience with this scenario they wish to share? I have also considered utilizing the Rental Partnership Program with the Military, as I used this program myself many years ago. Any experience with that?
Thanks In Advance
Don't count Central Virginia out! Plenty of deals that make sense.
If you were in the Navy then you were probably stationed in Norfolk. The Naval staffing forecast is for a slight increase in personnel. That being said most parts of the Norfolk, Virginia Beach area are self sustaining and not as reliant on the Navy, or Oceana which is good.
There are plenty of NATO personnel that are stationed in the area as well. The Hampton Roads area has a very stable economy right now and should for the near future.
You will just need to treat this area like any area you investment and perform your due diligence and select multiple properties and determine which ones have the highest potential overall for your investment goals.
@Harold Osmun Have you considered investing in Southern Maryland around the Patuxent River Navy Base? There are some great deals to be had there and the rental rates are pretty high with the base traffic and all the contractors. If I had stayed there longer I would have done more buy and hold investing and flipping there. It wouldn't be too far from where you are in Northern VA and probably closer than the Hampton Roads area. I live in FL now but still have one rental up there and self manage the property. I have a realtor who gets it rented out for me during turnover time and does the walkthrough on move in and move out inspections. I take care of the rest from here. As long as you have the contacts if something goes wrong and a responsible tenant it can be very profitable to have rentals outside your area as long as the numbers work. The other way to go is to get good property management but I haven't had much luck there. My rentals are upper class homes so it makes it easier for me to manage the tenants and I don't have constant problems. That is my business model, doesn't work for a lot of people but has done me quite well so far.
Good luck and let us know what you decide to do.
Harold, it's actually not that hard. I live in Northern Virginia (Woodbridge), invest/self manage in HR area (buy and hold ... and my first flip goes to closing on Friday!!!!!) and I'm a prior Navy guy too. The keys to my success have been threefold - buy distressed above average properties, put some working into the house (averages about $3k above paint and carpet) to update all the usually suspects (toilets, faucets, water connectors, old cruddy light switches, and any visble plumbing and caulking issues -- you know, standard PM work from the Navy days and then get a home warranty. That 1, 2, 3 combo fixes 90% of little, nuance troubles and the home warranty covers appliances, hvac, electrical, plumbing, etc calls with only $75 out of pockets per event. Had an existing fridge go bad and the HW couldn't fix so they REPLACED it for the $75 trouble call. He home warranty a purchase was $320 so I'm playing with house money now!!!! My tenant was the POC on the warranty and I never met the contractor or the appliance pickup or install guys. The warranty co manages it all. I just get emails from the Home warranty stating what has be done. It can be done. This model was taught to me, it works. Good luck!!!
@William Randolph What was the home warranty you used? Sounds like a good one.
Interesting thread... I'd done quite a bit of analysis on many of these market areas over the years, and Central VA does have deals, as does Southern MD. One thing to consider is flood insurance (if you are in NOVA you don't have to think about it a lot) but in Hampton Roads/ VA Beach it can add up. In general, the southern VA markets haven't experienced the same amount of appreciation in recent years. Here's some good regional data if this helps (these were all reports I built when I worked at Long & Foster):
I completely agree that Southern MD is a great market. I'm looking there quite a bit in the future. I also see good things for buy in hold in some of the smaller areas outside of DC. Hagerstown, Winchester, Fredericksburg, etc. If you'd every like to see some of the analysis, just reach out- I recently presented to a local REI in NOVA and could share the presentation with you if you're interested.
@Michael S. Helton First American Home warranty. Good service and no issues so far. I highly recommend. Much success!
First of all, I would like to thank all of you for your input.
@Jeremy Vogan Very interesting deal. Where can I see your whole portfolio? I am interested to see what else you have to offer.
@Jeff B. Thanks for the info. I have covered most of this already, but I like hearing confidence in the area I chose.
@William Allen I had not thought of looking in that area yet. I am looking through some properties there now and you are spot on. Thank you for the heads up.
@Elizabeth Nourse I appreciate the heads up regarding flood insurance. I know that most policies do not cover it unless you specifically purchase it. I have that report already printed in my research binder, but thanks for reassuring me I am looking in the right place. Also, as for your analysis, I would really like to hear more. I will be sending you a colleague invite in order to talk with you. Thanks!
@William Randolph Excellent Idea with the home policy. I had not thought about this yet. I am curious to know who you get your policy through. I have sent you a colleague request as well to speak with you. I am interested to know if you have a written checklist you follow in your process. Thanks again for the info!
I read Elizabeth stated that Hampton Roads did Not have the same amount of appreciation. That was because the area did Not suffer much at all depreciation due to the War and military personnel surge and businesses/employees supporting the military demands for housing.
Harold probably knows that BRAC has threatened to close Oceana Naval Air Station since 2005 but failed as it has ended up costing the military considerably more money to close and realign the bases then it was planned to save.
"But the department estimated similar excess capacity in 2004, when the last Base Realignment and Closure (BRAC) round was approved. It reduced the military infrastructure by less than 3.5 percent and ended up costing more than $35 billion to achieve roughly $4 billion in future annual savings." Military Times (Pentagon: Another BRAC will save money.)
I have a rental in VB, and prices decreased substantially due to the large number of foreclosures. Only now are prices starting to increase again. Rents have been pretty stagnant too. I imagine this depends highly on the area though. However, there are many people moving in/out of the area all the time so finding tenants is not too bad.
If you stay away from the coast then you might not need flood insurance. Look at elevation on the street you are interested in, and look for properties that are at the high end. Norfolk is constantly flooding so I would be wary in investing there. Also watch out for PB pipes, if any property has those replace immediately, its just a massive headache otherwise.
Anyway that's my thoughts and experience.
If you have any questions feel free to PM me.
@Harold Osmun I will tell you the same thing I tell everyone else on BP who thinks there market is too expensive to invest in......look where you are. I am also in the DC area, and it is not too expensive to invest here. We all think the grass is greener someplace else...and it is not. I personally do not invest in ultra cheap properties...but there are plenty of people here in DC who do, and make a good living doing so. Within an hour drive of where ever anyone in the country is and you will be able to find very cheap properties. In your case, you would just need to cross the river into PG county to discover them.
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