Realtor · Leesburg, VA · Member since 2019 · 56 posts · 30 votes
I live in Loudoun County in Northern VA, avg price point is ~500k for a SFH and I am starting to drive for dollars.
Just curious for those that do/have done this:
- how do you approach this practice in areas where there aren't really any borded-up properties or "visibly distressed" properties?
- my investing strategy is buy/hold and BRRRR which I think works in this market because I'm making more long-term plays.
- have you found a deal/deals in a high priced market and can share the details?
FYI I'm a new investor so I'm still in the planning phase. I am still researching and part of that is coming to BP and masterminding with others. My goal is to get my first property in 2021.
I'd strongly recommend getting outside of northern VA.... VA itself has a lot to offer! Find military bases, as it essentially locks down a transient population. Check out the Tri-cities, which is south of Richmond, Hampton roads, Roanoke or I've been hearing some things about Blackstone VA!
Real Estate Consultant · Chattanooga, TN · Member since 2018 · 384 posts · 330 votes
5y
Hey @Muoki Musau! Great questions, and I'm curious to see what insights people may share. Coming from a Northern Virginia mindset, I didn't really understand "driving for dollars" until I recently visited a less expensive area, where it was possible to drive around and see properties that were notably distressed. I'm curious how people do it in a profitable manner in NOVA. There are some that are visibly distressed here, but they are so few and far between...
Property Manager · Baltimore, MD · Member since 2014 · 1k+ posts · 1k+ votes
5y
If you're driving for dollars, and therefore by necessity are looking for visibly distressed properties, then I'd expand your market outside of NOVA. PG County in Maryland might be a good target for you.
Investor · Marin County California · Member since 2018 · 1k+ posts · 2k+ votes
5y
Yeah, here in southern/central Marin $699,000 is base entry level for a 2/1. Typically, the place looks like it has been hit repeatedly by cannonballs. Also, typically, it will sell above list price within 7-14 days with multiple cash offers, no contingencies. Honestly, I don't see how your strategy will work in Loudon County. These markets are too much in demand and too efficient to let properties slip below market value.
Realtor · Leesburg, VA · Member since 2019 · 56 posts · 30 votes
5y
@Joe Norman that’s an excellent point. I could potentially expand out and D4D outside NOVA while also keeping an eye on the pulse here for under market buy/hold options...
Real Estate Consultant · Chattanooga, TN · Member since 2018 · 384 posts · 330 votes
5y
@Muoki Musau I'm heading down to Chattanooga TN, which is experiencing great growth and appreciation, but is still at more approachable price points versus Northern Virginia. A part of the plan is to setup a system that makes it easy and profitable for out of state investors to buy in to the market there! I'll be sure to keep you in the loop on opportunities!
I'd strongly recommend getting outside of northern VA.... VA itself has a lot to offer! Find military bases, as it essentially locks down a transient population. Check out the Tri-cities, which is south of Richmond, Hampton roads, Roanoke or I've been hearing some things about Blackstone VA!
Real Estate Agent · Reston, VA · Member since 2020 · 84 posts · 53 votes
5y
@Muoki Musau
Hey, I am in loudoun as well. I think if you go west (Winchester to west va maybe), or south you can find deals still. Portsmouth/hampton/Newport news is a much cheaper area and might be worth a weekend youre free to take a trip. Also, as a military town the houses there rent fast making it attractive to somebody who wants to brrr. I have been looking at properties down there, as well as west va but only through agents. I need to plan a trip and drive down there one weekend. Most HOA in our area would never let a house look uninhabited lol I get letters from the HOA the morning after I lose a shingle in a storm haha
Real Estate Broker · Bowie, MD · Member since 2014 · 242 posts · 44 votes
5y
@Muoki Musau in my opinion, there’s always opportunities within NOVA, you have to look really hard for them. Look at older communities built in the 90s (especially in Woodbridge, Centreville, and surrounding areas), and you’ll see homes that haven’t had yard work complete or show other notable signs of distress (damaged/dirty siding and what not). Those are good options to start with if you want to stay closer to your area.
Investor · Northern VA · Member since 2020 · 124 posts · 87 votes
5y
@Muoki Musau I think there is still opportunity in Loudoun County. You just have to use different criteria than you would in SE DC or Baltimore. The opportunities will present themselves differently, but they are there, especially in Leesburg and Sterling. Fairfax and Centreville are good markets too right now if you want to drive a bit further.
Ashburn, VA · Member since 2017 · 85 posts · 28 votes
5y
@Muoki Musau - there are always distressed properties - D4D might not work, but you can try pulling lists and mailing them. Also, you can look into foreclosure auctions on the Leesburg courthouse steps
This was great input from everyone! I am new too and not very hopeful for NOVa area...but good to hear confirmation that some areas mentioned might be good!
I like your questions so here we go. I have dubbed myself the "King of Driving for Dollars", lets see if I can add some value.
To give a perspective. I only buy in areas that are middle to upper class. The average value of my homes is probably in the 500K range, probably comparable to your market.
Q. how do you approach this practice in areas where there aren't really any borded-up properties or "visibly distressed" properties?
A. This is probably a good thing. To not find boarded up houses signals there is a ton of demand. When I drive through a new area to invest in, if I see tons of vacancies I usually run for the hills. I look for small things. It is usually the roof. I am in the Northwest, if you don't take care of the roof, your house will soon be wrecked. Also, look for houses that just look vacant, and have been for a long time.
Q. my investing strategy is buy/hold and BRRRR which I think works in this market because I'm making more long-term plays.
A. Great!
Q. have you found a deal/deals in a high priced market and can share the details?
A. Sure, I am not really one to "kiss and tell" but here we go. I just bought 2 houses across the street from one another. I felt like the owner was trapped by her tenants (if you want to call them that) and needed a way out. Oddly, this is a common occurrence. The non-visible sign, was that she was constantly behind on her taxes. One of the houses had not been lived in for 10+ years and the other had 15 people living in it. I just sold on of them and the other I am doing a BRRR'ish type deal and keeping it as a long term rental.
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I feel like people telling you to chase other markets are really misguiding you. Honestly, there is a reason why markets have boarded up houses. My strategy is to pick an area that has old homes, increasing values, and tons of demand. You will find houses all across the new, depreciating, junky, rejuvenating spectrum.
Hey, I am in loudoun as well. I think if you go west (Winchester to west va maybe), or south you can find deals still. Portsmouth/hampton/Newport news is a much cheaper area and might be worth a weekend youre free to take a trip. Also, as a military town the houses there rent fast making it attractive to somebody who wants to brrr. I have been looking at properties down there, as well as west va but only through agents. I need to plan a trip and drive down there one weekend. Most HOA in our area would never let a house look uninhabited lol I get letters from the HOA the morning after I lose a shingle in a storm haha
Thanks James. Your suggestions are helping my intuitions, along with other suggestions people have brought up.
I'm glad I asked, the responses have been very very helpful.
@Muoki Musau - there are always distressed properties - D4D might not work, but you can try pulling lists and mailing them. Also, you can look into foreclosure auctions on the Leesburg courthouse steps
Pulling lists and the courthouse might be good options in the area I'm in, then perhaps D4D in other areas.
I drive for dollars every week in the most expensive neighborhoods in McLean.
I work for a builder though, so the numbers are a bit different. We are building 3 to 7 million dollar houses.
You won’t find people in foreclosure or people who are behind on property taxes.
Mostly people will not sell at a big time discount as they are not in a rush and have other homes and other options.
You have to catch people at the right time and make them a strong and competitive offer.
But I look for older homes that the owner has had for decades, usually.
It sounds like your D4D is very strategic, which inspires me to ask myself, "If I'm D4D, what's my endgame?" Or "what kind of deal am I looking to make out of a potential opportunity?"
@Muoki Musau in my opinion, there’s always opportunities within NOVA, you have to look really hard for them. Look at older communities built in the 90s (especially in Woodbridge, Centreville, and surrounding areas), and you’ll see homes that haven’t had yard work complete or show other notable signs of distress (damaged/dirty siding and what not). Those are good options to start with if you want to stay closer to your area.
Avg age of homes - wouldn't have thought of that as a criterion to narrow my focus. Thanks Stephanie.
Just curious, you're in Bowie, has this (or a similar) approach been helpful to you?
@Muoki Musau I think there is still opportunity in Loudoun County. You just have to use different criteria than you would in SE DC or Baltimore. The opportunities will present themselves differently, but they are there, especially in Leesburg and Sterling. Fairfax and Centreville are good markets too right now if you want to drive a bit further.
Fairfax and Centreville are a pretty nice "further"- a lot more accessible than a Winchester!
Realtor · Leesburg, VA · Member since 2019 · 56 posts · 30 votes
5y
Wow.
Hail to you, oh King!
Thanks for talking about the circumstances of your deal w the owner "trapped by tenants"- one of the things that stands out from your response is that the method to find deals varies from price point to price point. Sure, ain't no homes being beat by cannonballs, but there are signs, I just have to look for them.
To others' points about looking into other markets, I still think it's helpful to have this growing body of knowledge that might prove useful as I continue to develop into an investor.
Real Estate Investor · Crescent Mills, CA · Member since 2010 · 128 posts · 74 votes
5y
Do remember that it's not only distressed properties that you're looking for. It's also distressed owners - the property might not be distressed at all.
Owners may be in hospital and gardeners (and/or relatives) may be maintaining yards and property.
Owners may be dead and ditto re gardeners and/or relatives. But a caveat, I don't know about VA, but in CA if house has to go through probate, buying could take a while (up to a year or more) and allow for overbids in court. (So look for houses held in a trust for faster purchase.) If heirs have their own homes, they might be glad to be rid of it, especially if they're driving a distance to take care of the property.
Look for properties that have been owned for 30-40 years (or more) by same owner; owners > 70 years of age, etc.
Real Estate Agent · Reston, VA · Member since 2020 · 84 posts · 53 votes
5y
@Mary Cronin
This actually reminded me, I have a coworker who's grandma just died from Vienna and they are pretty much in that situation. Everyone is successful and they are basically getting rid of the house right now. The family is in the construction business and are too savvy to give it away for anything less than it is worth. However if that wasn't the case I could totally see a family basically wanting to be rid of granny's old house.