Hi Everyone,

I live in Reston, VA and really interested if anyone has experience in the northern Virginia market on what's the best investment strategy? I know that SFR's are expensive, I am interested in rental properties with descent returns , is this possible in this area? thanks!

Anything is possible , but rentals that cash flow for a good price in NOVA you are looking for a needle in a haystack . There are deals , you gotta be first and you gotta be cash 

Buy....hold....watch your balance sheet grow. That seems to be a strategy that works well in the DC area.

Northern va is tough for cash flow. If you want that you need to come out to the wild Wild West

@Karim Z. like many have stated, NOVA is hard to cash flow, a few of the strategies I use in the DC/NOVA area are: 1) My favorite because it allows me to purchase before the investor pool of buyers bid up the property. I buy REO's as Owner Occupant. I'm single so this works for me since I don't have to move a family around every 13-plus months after my Owner Occupant timeline has been met. 2) I also buy low-rise condos or Townhouses with low HOA dues, they will cash flow in the area. I've been successful with this strategy, keep in mind you won't be closing on 3 - 10 properties a year with this strategy, it's strictly for the long-term buy and hold portfolio.

@Karim Z. cash flow is tough in the DC market unless you buy multifamily. Since the values are high, your return cap rate will be lower. If you can find it, the best first investment would be a residential multi 4 unit where you live in one of the units and rent out the other three. You can get a cheap residential loan and the other rents should cover your mortgage. If you are buying a SFH or Townhouse in NOVA you are doing pretty good if you break even in cash flow. Most investors around dc are banking on high appreciation. If you buy in areas like Dale City (Woodbridge) or Manassas, you should be able to get some cash flow on a SFH or Townhouse. The trick in dale city is to analyze each neighborhood separately, there seems to be a lot of variability. Good Luck!

@Karim Z. I like buying 1-story SFR in NOVA and rent them out by rooms. Much easier with no HOA fees, HOA rules and possibilities to build out/up.

Hi Karim, Agreed with the others who have responded, very challenging to rent for cash flow in Northern VA. One idea may be to flip one to generate cash and then re-invest your cash into a rental property. Rinse and repeat. you essentially generate good cash on cash return flipping an then re-invest into a long term buy and hold.

@Matthew Paul @Russell Brazil @Ben McMahon @Ray Johnson @Dan Bernstein @Sam Lin @Bobby Montagne    Thanks everyone for your advice, it's very clear now. 

Karim,

I too live in Northern VA., and you're right about how hard it is to get cash flow in this area. You may want to consider an out of state turn-key rental property. I sold my Bethesda Condo because the taxes and condo fees were going higher than the rent could keep up killing my ROI. I took the proceeds from the Bethesda property and purchased (2) two single-family homes in Jacksonville, Florida. There are a few great Turn-Key companies working in Jacksonville, Memphis, Houston, and Dallas. You may not get the appreciation from the DMV, but if you're looking for cash-flow out of state will give you a much better ROI. Best of luck to you.

@Michael Santorios thanks a lot ... this makes a lot of sense.. I agree i think best strategy for someone in NoVA is “ out of state “ turnkey rentals and have the right team/PM on the ground —- any views on ATlanta for SFR turnkey ?

@Karim Z. , I've never looked at ATL but would assume it would be a good. If you find the right property management company and the property(s) have all the right "numbers" for a good ROI, I'd consider it. The only reason I settled on Jacksonville was because I received a referral to the Turn-Key Property management company JWB whom I love. I also spoke with Memphis Invest and was very impressed with both companies. I would work with either, but I settled on Jacksonville because I know Florida better than Dallas, Houston or Memphis, and the properties I bought has the right ROI and purchase price. I also plan on moving to Florida once I retire.

I have off market properties deals, maybe I can help!