Is Baltimore turning a corner?

Question

I am interested in hearing thoughts on Baltimore City as a place to invest in real estate. I have been optimistic of late with how constructive the manifestations have been here relative to the other areas of the country. I also think we have an opportunity with a change in leadership that is coming. Would be interested in hearing others thoughts.

Joe Norman · Answer

Well it appears that we just elected a convicted theft and embezzler as mayor, so I'm not too optimistic about the new leadership. That said I have never looked at Baltimore as a market to invest in for appreciation, but from a cashflow perspective its fantastic. As with any market, an landlords's success will depend heavily on their ability to attract, vet, and retain great tenants.

Account Closed · Answer

Sebastian E. Real Estate Agent from Baltimore

I hope it will turn for the better, I own many houses and commercial buildings, in  Baltimore, There is no leadership here, these politicians condone not paying rent, they will not let you legally evict tenants for non-payment or will they let you evict squatters, smoking pot on the streets is OK according to AG, can't open my Nightclub or other walk in businesses.

I have always been positive and enthusiastic about this town and investing, but the liberals in charge have beaten me down, never felt so negative!

As an auctioneer with family businesses and at 78 years old, I continue to use a program I and teach; POWER PROSPECTING and Control and Roll to hunt down buildings, houses, commercial buildings, lots and land that have a potential for cash flow or equity. Now more than ever those elements should be abundant in the community.

I continue to book auctions and control all types of properties, I hope some real leaders are elected who will take care of owners of businesses and stop taking us for granted!

Being on LOCK-DOWN almost feels like being retired, home all day (prospecting, sending out contracts offers to out of state sellers, partnering deals I never ever see, practicing  my art; water color, sketching and getting lots of stuff done at home - WOW! I could get use to this.

Donn't give up hope, continue to talk to sellers, provide them with a proposal/contract offer, control and roll real estate for cash flow or equity, be honest, make full disclosures and the income you are seeking will be yours.

Have a plan - don't slow down your prospecting, make many offers all the time, use a Skinny contract. Stay healthy, stay away from bad people.

Some ideas to find the deals:

walk/drive neighborhoods, look for neglected properties

advertise, newspapers, radio, pass out flyers

Write a nice letter to landlords

When housing court starts up again, meet landlords there - chat

Call and visit owners of Expired Listings - make offers

Build a relationship with a few Realtors, offer to pay them a fee (3-5% of purchase price for unlisted buildings) for presenting your offers to FSBO's and expired listings (auto pilot investing) The purpose behind this is to open negotiations with sellers, I always offer well below their asking price BUT IN WRITING hand delivered by an agent (you save time, cost of gas and you increase the odds of finding a fat equity deal)

Study Real Estate Control techniques; delayed settlement, assignment clauses, all types of options, hybrid or JV with sellers, repair consideration with possession (known as front porch offers) use one of the 21 proposals for seller financing (the best highest leverage financing you can get)

My LOCK-DOWN has proven to be profitable, I have time to network and develop clients nationwide to mentor/partner transactions. Meeting lots of folks who want to improve their real estate business.

So there you have my opinion and how I feel!

Be safe, make offers, find a great agent, study creative financing and enjoy life and the wealth it can bring you.

Charlie at home in Glen Arm

Account Closed · Answer

Timing might be right, people need to live somewhere, why not at your house, the one you just creatively controlled and negotiated a giant discount on  an IRR of 37%.

Baltimore is on the crap list now to many who listen to nay seers , but folks need housing, businesses need space, sellers need end results; Timing  may be right if you are smart enough to see thru the crap that is going on and learn the secrets of creative financing negotiating skills, assignments and creative ways to insert yourself in the chain of title. Baltimore will come back and will create entrenchments who will suck money and equity out of the proposed hard times!

Sellers of houses and commercial buildings could now be motivated, may be willing to take time to discuss their property and potential solutions to DUMP the real estate and take their mask and clovers  off and drive to Florida. To hell will real estate! SHOW ME THE MONEY! They are thinking; I don't need housing inspectors, lead paint suits, tenant's right in rent court, politicians against landlords, water bills in excess, squatters or law suits!

Keep your ear to the ground, listen for the opportunities.

Real estate can be CONTROLLED without money if you're smart enough to apply simple controlling formulas.

(so hard for me to type with this mask on!

Charlie - my opinion only

help, trying to reach 2,000 votes, getting close.

Alan C. · Answer

Like a drug addict, Baltimore must first hit rock bottom before there is any hope of change. And the city has not yet reached its low point.

I'm a native and current resident of Baltimore and it pains me to see the condition of the city. However, as has been noted, the cash flow opportunities are amazing as long as you take into consideration all the potential downsides. If you plan right, rehab the property correctly and screen for the best tenants, you can make good money.

I’m a long-time Baltimore investor as well as co-founder and president of a local real estate investment association (REIA). I've done about every type of residential transaction that you can think of from wholesaling to rehabbing and owner financing.

Feel free to contact me for more ideas.

Alan C. · Answer

I agree that you can force appreciation as you can in any rehab project. However, there are a limited number of areas in Baltimore where you can do that. In the rental areas that make up a large part of the city, it is unlikely that you will get much, if any, appreciation once you have a property renovated and rented out. Personally, I would never buy for long-term appreciation anywhere as I consider that "icing on the cake."

In my opinion, if you are in the buy and hold camp, then your primary goal should be to have as many paid-off properties as soon as possible. I am not a big proponent of constant refinancing unless you are starting out and can pull your initial investment out so you have zero money in the deal. Then use your initial capital to get more properties. Once you have 5-10 properties, I would try to pay them off ASAP via wholesaling, rehabbing, etc. The rental cash flow will allow you to have all your living expenses covered and you can spend your time doing more deals or whatever else makes you happy.

I knew a lot of people buying for appreciation in 2003-2007. Most of them were out of the business by 2009. You never know when the market will turn and your property value is reduced. If you have a free and clear rental property, you can always reduce the rent a bit when times are tough and you will always have cash flow.

Ozzy Sirimsi · Answer

I don't expect a leadership change or at least a leadership style change here. It will be same old same old :D))

However over the years I have seen changes in Baltimore even though still losing population like @MattSchelberg said.

They built and continue building that harbor east section, Hampden was a crazy place ten years ago, I remember days that I did not want to walk around Remington, don't even want to start with pigtown :D)) etc....

Despite all the negatives it is still somehow improving, and you can still find these pocket blocks that surprise you and, and people are making money ( I am included)

It was a perfect place to invest 10 years ago (time goes fast) now it is still nice place to invest despite the prices went up like crazy. However, I don't expect a big change in the city.

May be one of us should run for an office and make the change :D)))

PS: I still cannot believe Sheila Dixon is ahead of everybody, crazy crazy crazy

Kevin Klaas · Answer

@Joe Norman

I agree that Baltimore is a place to invest for cash flow but not appreciation. Currently, Baltimore has one of the highest homicide rates per capita in the country. That being said, there are still opportunities in a handful of neighborhoods, in my opinion.

I've been living Baltimore for the past three years so I feel like I have a good sense of the area.

Some neighborhoods to consider would be Federal Hill, Locust Point, Fells Point, Hamden, and Canton just to name a few. These tend to be some of the safer neighborhoods and where many students and young professionals choose to live. I currently live in Locust Point and really enjoy it.

Let me know if you have any specific questions and I'll do my best to help!

Omari Williams · Answer

@Sebastian E.

In the right neighborhoods, and the right properties, Baltimore is an excellent market. Yes the city is rough, but there is money to be made. Tons of investors are flipping decent to really nice properties across the city. The buy and hold investors are doing well too. I have an investment property in the city. There are also opportunity zones where the city has selected for growth with major projects. I recommend it for the savvy investor.

Ozzy Sirimsi · Answer

You just called the areas that everybody knows :D))

Matt Schelberg · Answer

@Sebastian E. I hope you are right but seems like there is an equally strong argument for continued decline and negative population growth in Baltimore City. Post-corona there are already signs of a new push to move to the suburbs. The things that make city life fun -- bars, restaurants, etc will not be as fun with face masks and social distancing over the next couple years. Move to the suburbs and you get lower taxes, lower crime, and higher quality of life.

If population continues to decline we'll lose our tax base and the politicians will need to raise taxes even more. But like @Joe Norman said, Baltimore City was never an appreciation play. It was about cash-flowing rentals.

Is Baltimore turning a corner?

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