Buying a townhome in brambleton to rent out (renter, mortgage)

[johnsonkk]

Originally Posted by boyd888

Great point and I think this is a major issue in parts of Prince William (especially Bristow/Gainesville). You have a ton of McMansion type homes built 2004-2006ish and they just sit on the market. People paid top dollar when they were built and many are likely upside down. I think the whole area is massive overpriced given all the added congestion to 66 in the past years, but that's just me. People can go 10 miles (or less) west and get brand new construction (really a no brainer if you aren't commuting east). Not to mention a 10-15 year old home will be much more likely to need repairs.

That's the renter appeal ( which is what OP wants) is the aseier commute options from the 95 corridor. I put in the rental ad that a direct commuter bus stop (PRTC) was one block walk. $11 round trip door-to-door or slug lot less than 1/2 mile.

Renters often know traffic pitfalls better than average buyers new to the area. Options help market property.

[LetsRock]

I don't see how you would make any money. Who is going to pay a premium to rent way out there when they could buy? I see this barely breaking even with maintenance and taxes.

[TheWatchmen]

Not a great idea.

[bluef250]

Originally Posted by Gasti1239

Thank you boyd888 and smartmoney
Both of you make great points. Even i had the same issue that brambleton is in the middle of nowhere. And also that people usually buy to own there not to rent. To this my realtor mentioned that brambleton has raytheon so can get defense contractors to rent there. And he mentioned buying a new property is better because of less repairs/maintenance. What do you guys think about that?
Do older properties demand a lot of high ticket maintenance items?

Raytheon isn't close enough to Brambleton. Sterling, Herndon, and Potomac Falls on the other hand are all significantly more close... not to mention they're within a 15 minute drive of the Silver Line. Anyway, Raytheon is in Dulles (Sterling) at the intersection of Waxpool and Pacific Blvd. AOL is there too. And Verizon is off of Waxpool & Loudoun County Parkway.

Brambleton is severely inconvenient if you're targeting folks that work in the general vicinity (Verizon, AOL, Raytheon, General Dynamics, etc.) And traffic going towards Brambleton in the evening rush hour stinks something mighty.

I'd say pass.

[FCNova]

I agree w the sentiment that Brambleton isn't the most desirable investment property location. I'd look at locations closer to metros. Tysons could be an option. A lot of townhomes there are too pricey for investment property purposes but there are older ones that can be had in the mid 500s. You'd have to run your own numbers to figure out your cash flow and projected ROI though. That area is already a huge job center and it's going to boom in the next 10 years with all the development projects in the pipeline.

[NC211]

Brambleton isn't exactly "the sticks" though. There is a tremendous economic driver that has supported years of mass residential building in that area. The big boys wouldn't be developing like they've been, if the sales and price appreciation trend wasn't there to support the efforts, which don't seem to be slowing down anytime soon (a little concerning, personally speaking). Toll Brothers basically dodged the recession with Loudon Valley Estates.


That being said though, the investor window I believe has passed for the area. That window started to close in late 2011 and early 2012, as prices started to run up quickly from that point forward. However, we lived in that area for 4 years, in a new development, and had a few townhomes that were rentals that were always occupied, but that was a very small count in the entire development of nearly 150 townhomes. Maybe 6 total.


As interest rates begin to rise, buyer pools will be trimmed due to mortgage affordability reasons. Values will likely adjust downward to accommodate, but only to a point. Then, quality and size will be trimmed next to reduce cost. Furthermore (and Brambleton is seeing this already), more attached housing will be approved to compensate for the increased land cost basis. Which for the investor doesn't play well for. If you buy now, the chances that you're paying the highest price for that unit over the next few years is likely, which translates into your needed rent level to clear your expenses. As rates rise, values flatten out if not decline, you're required rental level will have to remain the same. The flip-side to that position though is that as interest rates rise, what $2,500/month will buy you may not compare to what $2,500/month rent may provide you. So, you may have a rent level that makes sense. But, your value will remain flat, and you'll be competing with more and more townhomes being delivered to the market over the next few years.


At the end of the day, I agree with the comments to focus on the more transient submarkets around military bases. I will also caution you that if capital expenditures are a concern to making a rental work, then you may want to reconsider this idea in general. Renters for the most part, can be hard on their property. It may not be a broken this or a broken that, but something entirely different that impacts the quality of your rental, like odors that require significant capital to correct for the next tenant. Cat peeing on the carpet. Strong cooking odors. Smokers. etc. Sure, you'll have a security deposit of one month's rent. But $2,500 isn't going to fix those types of problems.

[FCNova]

Originally Posted by Gasti1239

And he mentioned buying a new property is better because of less repairs/maintenance. What do you guys think about that?
Do older properties demand a lot of high ticket maintenance items?

I disagree with your realtor here. I think it depends on the specific properties and you can't make a broad statement like that. Lots of older properties work great as rentals/investment properties. New does require less maintenance most of the time, which is great. But you pay a hefty premium for new vs a 20, 30, 40 year old property, which will result in a bigger mortgage(less cash flow). There's nothing wrong with looking at older properties if you do your due diligence. They aren't all money pits. My TH is 45 years old and we've owned it for about 5 years, and have really had no major issues. The HVAC system was only about a year old when we bought it. A few minor plumbing issues(~$300), some normal roof maintenance over the 5 years(~$1,000), a dishwasher($400), maybe a few other minor things. If you're serious about this I wouldn't focus on new or old, look at anything with potential and run detailed numbers to figure out if it's worth it.

[NC211]

...I would also add that newly built properties will go through a "settling phase" during the first 12 to 18 months. The wood will twist, bow, shrink and expand through it's first exposures to new seasons, then it should settle down. This means, little cracks in the drywall here and there are likely. Wood floors? Might see some larger gaps between a plank or two. Doors might be a little "sticky" when opening/closing. These are all very common things that happen to new-construction homes, and most (if not all) builders in the area are supposed to come back to fix them after the first year as part of their process to get their posted bonds to the county retired.


But.... some purchase agreements may void that standard if it's being purchased from them for investment usage purposes. You'd want to make sure you could buy from the builder as a rental unit. Otherwise, you'd be facing a relatively steep bill in about a year to, essentially, finish the construction.

[z28lt1]

Originally Posted by bluef250

Raytheon isn't close enough to Brambleton. Sterling, Herndon, and Potomac Falls on the other hand are all significantly more close... not to mention they're within a 15 minute drive of the Silver Line. Anyway, Raytheon is in Dulles (Sterling) at the intersection of Waxpool and Pacific Blvd. AOL is there too. And Verizon is off of Waxpool & Loudoun County Parkway.

Brambleton is severely inconvenient if you're targeting folks that work in the general vicinity (Verizon, AOL, Raytheon, General Dynamics, etc.) And traffic going towards Brambleton in the evening rush hour stinks something mighty.

I'd say pass.

While I agree that there are better locations than Brambleton for buying a rental, to say that Brambleton is severely inconvenient for the Verizon/AOL. Raytheon crowd is way over the top. Are there parts of Sterling and Herndon that are slightly more convenient? Sure. Other parts probably slightly less. Particularly with Verizon as it has multiple entrances and no need to go on Waxpool from Brambleton..

To AOL/Raytheon I think Brambleton is 20 minutes or less on all but the very worst traffic days, and can be 10 minutes just slightly off-peak (like 7:30 instead of 8:15 AM). It's 6-7 miles depending upon where in Brambleton.

Again, I'm not saying that makes it the right rental location, but it is totally suitable for the commuting to the locations listed.

[JT-3]

Although I think the purchase price might be too high, won't Ashburn/Brambleton have the metro stop eventually? Middle of nowhere to me is Culpepper, not Brambleton.