All Forum Posts by: Val Csontos

@J Scott

I see now, what you guys are doing, and based on your goals it make perfect sense, to be in that area! You will not get great cash flow with rentals in AA, HO county properties for at least the first couple of years!

As far as property values in our area, in my view we are way different here from Las Vegas. Vegas heavily relies on discretionary income from the general population where as here we have a very aggressive growth of our local economy that comes to us from all different direction. Years ago the big players had decided that this area has to grow and this is what we had experienced here for decades, now. We have a steady population gain of about 1.1% per year, most obvious reason for this is Jobs. This trend has started in the 80s and has really picked up in the 90s, continues today and is also projected by the US census, to be continued for the next 30 years. As the economy sank elsewhere our area has benefited.

For example the Base Realigned and Closure Act closed down several Military bases elsewhere in Virginia and in the southern states, and DOD had re-assigned DOD jobs to Ft Meade. Roughly 8-10,000 white collar jobs, and all of them are technology related.(number is conservative and not including the supporting jobs that comes with this much population growth)

Casino has opened two years ago with about 2-3000 jobs. Verizon is just moving here from Connecticut to Hanover MD about 1500 jobs.(Just had a tenant applicant moving here from CT with that company) This is again not including the local commercial development with about another 6000 positions already opened in past few years, also the hospital capacity has doubled here and in Ho County as well in past few years.

Just an interesting fact, and you might see similar situation in Baltimore Co. as well if you start renting your properties. This year 3/4 of our tenant applicants just came from out of state! That along would not be so unusual having large number of military population come and go, but these new folks are all civilians! Never been so many before! On the way it is sad because it shows you that some parts of the country is not doing well at all, but is great for this area.

Have you heard of Tyson's Corner center near Whashington DC? Friend of ours live there telling me that when they moved there in early 90s Town Homes there were $70ks and now they are $8-900K. I think based on the demographic data end the economic indicators for the area, the Anne Arundel Mills Mall area including the Ellicott City, Sykes-ville, Columbia, etc. Jessup,Hanover, Severn, Odenton etc. is experiencing something similar on the long run, does this effect the neighboring counties? You bet! But according to data from MRIS some counties HO,AA benefit more than others.

Since I am writing you from Annapolis let me finish with some "local language": You have your "anchor pulled and your compass set" so "Happy Sailling" or Happy Investing ! :)

Why complicate things guys? I just have my tenants go to our bank BBT and deposit the rent to our account. Most of the time they bring cash and I can start spending it 10 minutes later. It is also free for both of us, for the tenant and for us too! And if I don't see deposit by the 4th they get a text from me and if no response or no pay the 6-7th I go to the courthouse and file for Failure to Pay Rent. (cost only $22) and this will get them a notice and a court date. Which is most of the time is enough to get them pay. If they don't pay than we go for " round two" :)

@J Scott

@J Scott I had a little more time to look back and read the start of this thread. I was just wondering something. You told us via this thread that this time with your RE investment project, you are in it for the "marathon" and not for the "sprint", and i see, you live in Howard Co., is there any reason why not to look for houses there?

I had found over the years (by accident since I had no idea what I was doing back in the 90s) that areas with the best schools make the best long term investment properties.

My real "wakeup call was " in 2007, when I was talking to other investors from the Baltimore city/County, and they had told me their homes went down to the same price as they purchased those properties 15 20 year ago) Some of the houses they purchased ten years ago for low $60s, are now 5-6 year later worth in the mid $60s $70s at the same time I purchased some of my properties out here in the AA County(HO county is the same or better) for low$100s and they worth low $300s now.

Obviously there are exemptions based on neighborhoods etc,, and my statements are a sort of generalization. But in my view the point of long term rental is to "seat on" a low risk property which we can "cash in" just about anytime even during a low economic cycle and reword ourselves for our efforts times.

. I know some might say that it is almost impossible to find deals out here in the great areas, but in my view with some patience and with the knowledge of the area you can find some really nice deals. And when you look back in a few years, does it really matter that it toke you a few weeks or even a few months longer, if your property worth $100s of thousands more and is a lot more immune to the economy's ups and downs. Also rents better sometimes with waiting lists :)

By the way another advantage of investing in HO county that the quality of tenants has been shown an increase over the years as the "flakes" has been continuously priced out of the area and tend to be moving towards Baltimore County, Glen Burnie etc...and this trend with tenants seems to continue for the foreseeable future as BRAC, Cyber Security, Verizon and other project are bringing more jobs into our area etc.

Please take this as a constructive and positive commenting, to your thread and Good Luck to guys for your long term project, I hope it works out for you and your partner! :)

Sounds like you need to raise your rent may be by a hundred or more per month, as the potential applicants looking at your asking rent might think your place is a slum based on your local market!

I had similar problem in the past. Competition raised rent so fast, that my unit fell behind by 3-400/mo. Easy fix with happy outcome for you :)

@Shaun Reilly you are right!! It is a must that You know you local laws where you have properties. Happy Investing!

If you must evict, i would recommend not to get legal advise from here, rather go to your county courthouse and ask for a Tenant Landlord Law Guide or handout or even the online link for the same. Most Court Houses have some sort of a handout regarding to steps that are involved in order to evict someone. You will see it is not that difficult just obey the deadlines and pay attention to details.

@Chan K. you do not need late fee! This is what you can do if late fee is not allowed:

Say if you charge rent $1300/mo then write up your lease for $1450 and give 150/ discount if they pay by the 4th. It works for me really well.It was even court tested once. (here in MD you only allowed to charged small 2-3% late fee), but with my "discounted rent" I get around this problem pretty well to discourage "lateness" Good luck to you!

@Mike C.

Military folks can set up direct deposit straight out of their paycheck to any bank account, so you could ask them to do this if you like! My lease states: "tenant must set up a deposit with in 60 days of lease start date" After that they can still send me checks but it will be a $13 handling fee for each check!

Just so you know cashier's check can be cancelled for about $30! For holding deposit I like to take cash but i also give a Lease Agreement as the receipt therefor I never get a complaint about that!

Being a US Air Force veteran myself I have positive experienced with military folks. Most of them do stay about 2-4 years and usually no extra deposit needed. The only thing is you MUST give them a PCS clause ( if they get Gov Orders to go you terminate lease normally so they get their deposit back) in your lease!

I Believe it is the law and the patriotic thing to do as well ! If they get an order to go and Uncle Sam wants them to go they WILL go even in January! But that being said they usually do not leave on winter keep the your place in good condition! Good Luck!

Years ago we purchased VA foreclosures. At the time they had some investor special programs they offered if the house did not sell for say 4-5 months:

VA was offering 100% financing, many of the houses were move in ready with some had missing appliances. We started to show the property BEFORE CLOSING (we had the "master key" to get in with) and we timed the lease signing to the same day as the Closing day. This helped us to start our rental home with zero vacancy and to buy refrigerator for the house, by using the first month rent to pay off the credit card for the fridge stove etc......