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Old 09-26-2016, 11:01 PM
 
29 posts, read 25,512 times
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My husband and I are considering moving our family from NoVA to the Annapolis area in the hopes of being able to afford a SFH (or townhome) with good schools. Being concered about the commute to DC I've decided to switch out focus to finding a rental home to test out the area, but there seems to be very little available for rent and the rent prices rival that of our close-in Fairfax county area here in NoVA. Houses in the low 300k range are up for rent for over 2K a month. What gives??? Am I missing something??
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Old 09-26-2016, 11:29 PM
 
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The landlord will rent for as high an amount as they can, obviously.
$2K rent for a $300K house seems quite low, if anything. $300K mortgage is about $1400/m, prop taxes are about $300/m, insurance probably $100/m. That's $1800 even before considering opportunity cost, maintenance, management costs, turnover, etc. I certainly don't envy that landlord's financial position.
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Old 09-27-2016, 06:06 AM
 
Location: Sneads Ferry, NC
11,923 posts, read 21,943,243 times
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Quote:
Originally Posted by Anita7210 View Post
What gives??? Am I missing something??
Property taxes are higher in Maryland than in Virginia, adding to the landlord's cost. Property near water is more desirable. Annapolis itself is a submarket with state government, Naval Academy and tech firms drawing in well-paid families.

You should not be considing Annapolis a low-cost area. You might look at closer to Baltimore like Crofton, Pasadena, Severna Park or Riviera Beach. If you do not need to be that close to water, Crofton is an excellent choice: good schools, and lower prices.

Last edited by goldenage1; 09-27-2016 at 06:45 AM..
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Old 09-27-2016, 06:48 AM
 
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I get that it draws in high income families but so does the DC area and I can rent a 400k townhouse out here 20 minutes from DC for 2K a month so you would think the prices would be at least a little cheaper an hour out from DC.
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Old 09-27-2016, 08:21 AM
 
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Unfortunately, this is in line. In Columbia a $2k month rent would give you a townhouse! Your also paying for the close proximity of the water. So, I'm not shocked by this.
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Old 09-27-2016, 08:30 AM
 
2,019 posts, read 1,979,964 times
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Quote:
Originally Posted by Anita7210 View Post
I get that it draws in high income families but so does the DC area and I can rent a 400k townhouse out here 20 minutes from DC for 2K a month so you would think the prices would be at least a little cheaper an hour out from DC.
A $400K mortgage itself is $2K a month in carrying costs. Property tax in VA on a $400K residence is $4K a year. A townhouse is going to have an HOA of $1.2-3.6K a year. Insurance will be 1K-1.8K a year. Management costs will be 8-12% of rent. Maintenance costs will be 5-10% rent. Either you're incorrect about the $2K VA property being worth $400K or the landlord hates himself and is losing a ton of money every month rather than selling the property for $400K.
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Old 09-27-2016, 09:06 AM
 
Location: Sneads Ferry, NC
11,923 posts, read 21,943,243 times
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Originally Posted by bufflove View Post
A $400K mortgage itself is $2K a month in carrying costs.
Unless it is a very old mortgage. If the OP can find a Fairfax townhouse renting for $2000/month, she might as well stay there, rather than commuting from further out.

Howevr, one advantage Maryland has is a fleet of MTA express commuter buses. I believe she could find a townhouse in Crofton under $2K/month, and the husband could easily get on a commuter bus to DC.
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Old 09-27-2016, 09:28 AM
 
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Originally Posted by goldenage1 View Post
You should not be considing Annapolis a low-cost area. You might look at closer to Baltimore like Crofton, Pasadena, Severna Park or Riviera Beach. If you do not need to be that close to water, Crofton is an excellent choice: good schools, and lower prices.
To me, Annapolis and the surrounding areas is a low-cost area. Where we are located now, we can't even get a small townhouse for under 380K in a good school pyramid. There is no change of us being able to buy anything that meets our needs in our price range around here. In the Annapolis area, there are SFHs with yards and good schools for 300K.

Here is an example:

This townhouse is very close to where we are living now:

9390 Peter Roy Ct, Burke, VA 22015 | Zillow

As you can see it is for rent for $2100 and the estimated price of the home is ~420K.

Here is a townhouse in Crofton:

1020 Murdoch Ct, Crofton, MD 21114 | Zillow

Rent is $1900 but the estimate price of the home is ~260K!

This seems off to me. According to Zillow, if I bought a house for 260K assuming 20% down and including taxes/insurance, I would be paying ~1200 a month. If I bought a house for 420K with the same assumptions I'd be paying ~1950 a month. Why would I pay 1900 a month for a house I could buy and only pay 1200? I understand there are maintenance costs and whatever else, but those things exist in NoVA as well so I don't buy that as an excuse.

Right now I am paying $1900 a month for a townhouse in an amazing school district 25 minutes from DC for a house that has an estimated value of 415K. I realize we got a good deal, so maybe this is skewing my perception, but it doesn't seem worth it to rent in AA county if I will be paying the same in rent as I am now for a house worth much, much less. I feel like we might as well go ahead and buy. Am I completely off in my logic??
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Old 09-27-2016, 10:01 AM
 
29 posts, read 25,512 times
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Quote:
Originally Posted by goldenage1 View Post
If the OP can find a Fairfax townhouse renting for $2000/month, she might as well stay there, rather than commuting from further out.
I agree with this totally. I don't see a point in renting in MD farther out for the same price. The reason we are looking in AA county is because we want to buy a house and are looking for something we can afford on my husbands salary alone. We can't afford to buy anything in Fairfax unless we rely on both our incomes. We would really like to rent first to make sure the commute doesn't suck the life out of us, but it doesn't seem worth it financially. The rent costs don't reflect the lower housing costs.
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Old 09-27-2016, 11:40 AM
 
Location: Land of Free Johnson-Weld-2016
6,472 posts, read 14,873,719 times
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Why do you have to MOVE there to see what the commute is like? Why not take a couple of days off and mock commute from there to work? I'm not sure why you have to rent a house to do this. Wow anyone else remember when Annapolis and NOVA were cheap? Sorry OP, that's my advice.
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