Purchasing a property for residence and rental

5 Replies

Hello all,

I have seen other posts regarding the Baltimore real estate investments but they all seem to be out of date. I am relatively new to the area (10 months and counting) and have got a pretty good feel for which areas are good and which aren't.

Currently I am trying to purchase a 3 Bedroom property for around 200K (conven. loan) and looking to rent out 2 of those rooms for around $700 each. I am trying to make the monthly payments come out to $2000/month for the total mortgage payment (taxes and everything included). Hence, I'd essentially be paying $600.00 in rent and split the utilities. I also plan on putting away around $100-$150 per month for emergency situation. I am essentially asking the community to see if my plan is naive, stupid or improbable.

Also, if someone has done what I am trying to do and has done it successfully, I am all ears! I'd even take you out to dinner and would love to learn what you have learned. 

My general interest locale for investment/residence are:

1. Canton

2. Highlandtown

3. Upper Fells

4. Butcher Hill

5. Little Italy

6. General area around Patterson Park 

If someone has suggestions of other areas in Baltimore I should look into, I am all ears on that as well. 

Thank you for reading this, and I am looking forward to this being an awesome and educative discussion.

Sincerely,

Jay Bhatt 

For that price you're probably not going to find a 3B2B in the areas you mentioned unless you lived a little bit more north. I don't know how comfortable you are with city life, but the area north of patterson park isn't the nicest place to live.

It looks like you're trying to meet the 1% rule. Unfortunately it's tough to find properties that satisfy the 1% rule in the nicer areas of the city. 

What you could do is find a 3B2B, live in a non-bedroom (ex. live in the basement), and rent out the other rooms. That should cover most of your expenses. 

Hi Jay,

I was killing some time during floor duty today and figured I would run a quick search out of curiosity. In those areas, there are 31 3+bed/2+bath properties. They are all in a rectangle with the borders being Central Ave., Eastern Ave, Rt 40, and Haven St. Hope this helps.

Mike & Asish, 

Thank you for responding to this post. And Asish, I've been thinking about actually getting like a 2 bedroom 2 bath place with a livable basement (doesn't have to be finished). I'd most likely rent out the two rooms and live in the basement and eventually work on finishing the basement. It's great to see that idea being a bit validated. 

Mike, Appreciate the help, I'll take a look at those 31 properties. 

Sincerely,

Jay Bhatt 

@Jay Bhatt It is trending towards a buyers market in the zone @Mike Kulnich mentioned.  Lots of new construction in the area has driven down prices. I've seen a few posts from sellers in the Patterson Park area scratching their head, unable to figure out why their properties aren't selling. So there should be some good deals out there.

For renting rooms I think you want a neighborhood with a good nightlife and a young unmarried demographic.  In addition to the neighborhoods you mentioned, I'd also look at Hampden and Remington (Grab a bite to eat at R House, it's pretty cool). Both of those neighborhoods border Johns Hopkins Univ.

Originally posted by @Jay Bhatt :

Hello all,

I have seen other posts regarding the Baltimore real estate investments but they all seem to be out of date. I am relatively new to the area (10 months and counting) and have got a pretty good feel for which areas are good and which aren't. 

Currently I am trying to purchase a 3 Bedroom property for around 200K (conven. loan) and looking to rent out 2 of those rooms for around $700 each. I am trying to make the monthly payments come out to $2000/month for the total mortgage payment (taxes and everything included). Hence, I'd essentially be paying $600.00 in rent and split the utilities. I also plan on putting away around $100-$150 per month for emergency situation. I am essentially asking the community to see if my plan is naive, stupid or improbable. 

Also, if someone has done what I am trying to do and has done it successfully, I am all ears! I'd even take you out to dinner and would love to learn what you have learned. 

My general interest locale for investment/residence are:

1. Canton

2. Highlandtown

3. Upper Fells

4. Butcher Hill

5. Little Italy

6. General area around Patterson Park 

If someone has suggestions of other areas in Baltimore I should look into, I am all ears on that as well. 

Thank you for reading this, and I am looking forward to this being an awesome and educative discussion.

Sincerely,

Jay Bhatt 

I would also consider remington, charles vilage, areas of hampden, etc...   there are many areas you can buy for that price range, but  are you willing to move away from the downtown or not?