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^Fairly inaccurate representations based on half truths.
I've been scouring the for sale ads for months. A lot of the homes for sale are from investors, however, they are completely renovating neglected properties by putting in hardwood floors, adding decks, putting in modern kitchens, repairing yards, and then, YES...flipping them. How that is a negative is beyond my comprehension. They are rehabbing communities and at the same time making a nice profit doing it. The homes they buy are generally foreclosures and short sales. Some people are simply choosing to characterize it in a negative light without knowing what the actual substantive result of these investor purchases have been. These homes they are flipping are not being sold for bottom dollar prices, so not sure how lowlifes are going to be able to afford them because they are not being sold cheap.
This is absolutely not fact and cannot be proven. This is simply your opinion. Unless you have gone to every home sold in the the area, talked to the new owners, and saw what they did to the properties, it is impossible to conclude that.
It is being brought into a negative light because it's a reality. Ask any realtor, rental properties brings down value. That is one of the reasons why FHA started coming out with new regulations on condos that prevented people from getting loans on condos in communities where the rental rate is high. These are signs of unstable communities because generally speaking renters have less to invest into a community, they move frequently, and neither they nor the landlord has much of an incentive to add value to the property.
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Originally Posted by Fast GTO
I also find it hard to believe that they are renting them. I've found that not to be the case at all when I was doing research into rental values. here is simply not that many homes available for rent on the market, and those that are for rent are in the 1900-2400 range also putting them out of the range of low lifes.
You do know a lot of people privately rent out their places and they don't necessarily go through MLS? It's very difficult to get an accurate assessment of rentals in the area for that reason.
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Originally Posted by Fast GTO
The largest benefit of these investors is that they are buying up properties that would otherwise stay empty, lower home values, be an eye sore, and represent hazards for the community. They put the sweat equity in that others are afraid of and rehab the homes and thus the community while also bringing in younger families; much of Fort Washington residential areas were built in the 1960's/70's.
Some landlords won't see it that way. Some want to just simply get someone in their so that they can get money back and they do the minimum to do so. It does help to have landlords buying them instead of just sitting there, but the reality is nothing is better than having the homeowner actually living at the property. That is the best possible scenario.
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Originally Posted by Fast GTO
So yes, investors are buying up a lot of properties, but they are cleaning up dead homes and modernizing them. Only other way to do that is build new homes, which is also happening in this area. Read bewteen the lines instead of taking a radio broadcast at face value. A search of zillow/trulia over a few months should tell you what you need to know. You'll notice a lot of these flips were bought at around 100k, rehabbed, and flipped for $275-350k. They sell quick because buyers want move in ready homes with modern upgrades. Buy a home in this area without significant upgrades means you are going to get a 70/80's styled home.
This is absolutely not fact and cannot be proven. This is simply your opinion. Unless you have gone to every home sold in the the area, talked to the new owners, and saw what they did to the properties, it is impossible to conclude that.
It is being brought into a negative light because it's a reality. Ask any realtor, rental properties brings down value. That is one of the reasons why FHA started coming out with new regulations on condos that prevented people from getting loans on condos in communities where the rental rate is high. These are signs of unstable communities because generally speaking renters have less to invest into a community, they move frequently, and neither they nor the landlord has much of an incentive to add value to the property.
I looked at quite a few homes in this area and poured through thousands of pictures. Most of the homes being flipped are in a lot better shape than what they were bought for. And they are priced out of the hands of the low lifes most are worried about. Call it opinion if you want.
Reality? Really? so we went from labeling my research as opinion to making a glittering generality you claim as fact. I talked to realtors as well when I bought and the opinion of the realtors I talked to was that these investors were doing the neighborhood a favor by rehabbing dead homes that would sit vacated due to the cost of repairing them.
Too many rentals is a bad thing but most of the homes in the area are being sold. I get this knowledge from the investor I bought from (so I guess that is an admission of disclaimer?). They said they make more selling than renting. Though they did say that this might change with the addition of the Casino etc... at which point they might decide to rent some of the properties. But that was a future investment decision. Currently the homes are mostly sold.
People look for almost any reason to knock even a glimmer of hope in this area. Homes are selling, they are selling for median prices that keep them out of the hands of low lifes. Homes that were abandoned are being rehabbed. Tell me again why the negative attitude about this development?
Well the interesting thing about that WaPo article is that the way they are determining who investors are is based on who is buying homes with cash... there are people who buy houses with cash and neither flip nor rent them out, they just live in them. Maybe that's a minority, but I'm sure they exist.
Article smell like a case where there were positive growth indicators for PG and someone assumed nothing good can happen in PG so they looked for what was wrong and found investors. But the fallacy is that investors are not an indicator for promotion of lower home values as some are led to believe. The homes being flipped would otherwise have been vacant eye sores. Beyond that the homes are sold significantly updated and at prices that put the out of reach of the low life's mentioned here.
Well the interesting thing about that WaPo article is that the way they are determining who investors are is based on who is buying homes with cash... there are people who buy houses with cash and neither flip nor rent them out, they just live in them. Maybe that's a minority, but I'm sure they exist.
That is not a good way to gauge who is an investor or not. Although it probably is in the minority, there are those that buy outright. Some buyers may be downsizing and use the proceeds from their house to buy another smaller less expensive one. It will be interesting how the market evolves this year. FHA just recently changed their requirements for PMI. Going forward PMI will not end after 5 years or 20% equity. Individuals purchasing now would be on the hook for at least 15 years and in some cases the life of the loan.
Well the interesting thing about that WaPo article is that the way they are determining who investors are is based on who is buying homes with cash... there are people who buy houses with cash and neither flip nor rent them out, they just live in them. Maybe that's a minority, but I'm sure they exist.
It is probably not a clear case but they likely making this assumption because most people with cash money aren't going to buy a place that needs work when they could use that same money to make a down payment on a much nicer place. I agree that there is nothing necessarily factual about what they are saying though. I can only speak from the neighborhood (condos) in which I am an owner. The rental rate is utterly ridiculous and for about a year the only people that could actually get a place were people who paid cash. No one could go FHA and if anyone went conventional they could have easily gotten a bigger or nicer place going FHA so there is not much of an incentive for people to buy conventional in that particular neighborhood.
I looked at quite a few homes in this area and poured through thousands of pictures. Most of the homes being flipped are in a lot better shape than what they were bought for. And they are priced out of the hands of the low lifes most are worried about. Call it opinion if you want.
Reality? Really? so we went from labeling my research as opinion to making a glittering generality you claim as fact. I talked to realtors as well when I bought and the opinion of the realtors I talked to was that these investors were doing the neighborhood a favor by rehabbing dead homes that would sit vacated due to the cost of repairing them.
Too many rentals is a bad thing but most of the homes in the area are being sold. I get this knowledge from the investor I bought from (so I guess that is an admission of disclaimer?). They said they make more selling than renting. Though they did say that this might change with the addition of the Casino etc... at which point they might decide to rent some of the properties. But that was a future investment decision. Currently the homes are mostly sold.
People look for almost any reason to knock even a glimmer of hope in this area. Homes are selling, they are selling for median prices that keep them out of the hands of low lifes. Homes that were abandoned are being rehabbed. Tell me again why the negative attitude about this development?
You keep saying quite a few homes, but my point is you are taking looking at real estate pictures as a means of knowing how much money is being put in these homes. I'm just saying it's impossible to know for a fact how much is being put in. On top of that, if those owners decide to rent out, I highly doubt they would put the same amount of money in to them that someone would if they are selling. It would simply cut into their profit to do so.
All I'm saying is there is nothing better for a real estate market than homeowners who actually live in the homes they buy. If renting was so great, FHA would not have started cracking down like they did.
I'm not going to get into the middle of the whole debate as to whether or not flippers are out to be slum lords or to do a service to the community while making a quick buck by buying cheap, renovating and reselling high.
I will say this, though:
Citydata statistics for Fort Washington assesses that rental median is over $1,400. But more importantly, it also assesses renting percentage as significantly under the state average. This suggests that for the most part, flipping is not resulting in rental single family housing units. Of units that are rental properties - single family or otherwise - it is of a price range that is beyond the range of the unemployed.
I'm not going to get into the middle of the whole debate as to whether or not flippers are out to be slum lords or to do a service to the community while making a quick buck by buying cheap, renovating and reselling high.
I will say this, though:
Citydata statistics for Fort Washington assesses that rental median is over $1,400. But more importantly, it also assesses renting percentage as significantly under the state average. This suggests that for the most part, flipping is not resulting in rental single family housing units. Of units that are rental properties - single family or otherwise - it is of a price range that is beyond the range of the unemployed.
How would they obtain those numbers? I have rented out my property and that information is not known by anybody but myself and my tenants. How can anyone outside of us know that if I haven't filed papers saying such? That is how real estate is. People can end up renting to just about anyone and sometimes they don't even get a lease together doing so. It is almost impossible to keep up with.
They generate the numbers through statistical sampling or even possibly by reviewing MLS rental rates (for a far less accurate gauge).
Off topic, but about the lack of a lease: Maryland law states that any landlord-tenant relationship must have a written lease if the tenant is to stay on the landlord's property for over a year, as that document is required to satisfy any legal disputes that may arise. Under a year, however, a lease can be conveyed simply verbally, but as inferred from my previous statement it will have trouble with enforcement if a legal issue arises. (Maryland Code, Real Property statute 1-10(h)).
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