Baltimore wholesale question - Posted by Gerald-DC

import · June 15, 2001, 1:32am

Posted by Gerald-DC on June 19, 2001 at 12:08:28:

Nate,

Thank you for your input. This deal is a total pass. Baltimore is a block by block city.

FYI, I have heard from two independent sources that the city of Baltimore and Hopkins (Hospital) are planning on doing some development in the area. But I don’t have enough evidence to entice me to invest in the area yet.

As you stated, no one in their right mind would buy or rent in this area in its current state.

Thanks again. We’ll have to meet for lunch this summer. My treat.

import · June 15, 2001, 1:32am

Baltimore wholesale question - Posted by Gerald-DC

Posted by Gerald-DC on June 15, 2001 at 01:32:29:

I am meeting with a seller for a property located in Baltimore nears Johns Hopkins University. She is very motivated to move this vacant property. She had it listed with an agent for 32k but there were no takers. It is not located in a great area. The house needs about 8k to make it rentable for the area. With the repairs the house should sell for around 42K. It’s a 3/1, fenced yard with a full unfinished basement in average to below average condiion.

The seller has indicated that she would sell the house for 8K if I pay all of her closing costs. $10,000 if she has to pay the normal selling cost of sellers. These are just her preliminary terms subject to haggle.

I have no intentions of doing any repairs to the property and see wholesaling as the only option for this property. My end buyer would probally be a landlord.

My question is at the 8k price with closing costs which will probally total 10K (estimate) is this deal a keeper?
If I have 10K plus any holding costs into the deal, I would be looking to sell it for at least $16,000 for it to be worth my time. Realistic?

I welcome comments from all but particular Baltimore area investors who are familiar with the area.

Thanks again for all that take the time to respond.

import · June 15, 2001, 5:36pm

Re: Baltimore wholesale question - Posted by Nate(DC)

Posted by Nate(DC) on June 15, 2001 at 17:36:01:

Gerald,

As another Washingtonian who has considered venturing into Baltimore investing a few times (and hasn’t yet for reasons I’ll detail below), I have the following bits of advice for you.

The city is block by block. If you don’t know the specific situation of the exact block on which the property is located, you cannot figure it out from the general area or from the next block over. There are abandoned blocks literally around the corner from nice ones.
Is the house near Johns Hopkins UNIVERSITY or Johns Hopkins HOSPITAL. If the former, it COULD be (not necessarily) in a decent area. If the latter, don’t read any further, just run like h*ll…if ever there was a neighborhood that defined “warzone”…
Be careful of using comps unless you know the area well enough to know which ones are real sales and which ones are flip-scam transactions.
Call Steve Cook. He knows the city like the back of his hand and saved me from getting into a lot of trouble there in the past.

Good luck in Bawlmer!
NT

import · June 18, 2001, 4:30pm

Re: Baltimore wholesale question - Posted by Gerald-DC

Posted by Gerald-DC on June 18, 2001 at 16:30:00:

Nate:

You really nailed this one. Saw the property yesterday and it is in fact near the Hospital. If any new investors are reading and want to see an actual warzone, contact me and I’ll send you this section of Baltimore. The block was a wretched drug infested area with all manner of unsavory indiviauls in pursuit of neferous activities.

Eighty percent of the houses on this block were boarded up and trash, litter and empty forty oz bottles abounded. If the seller calls me again I may offer her $2000 for the house and just hold on to it if she accepts. I am more inclined not to make any offers at all, I don’t even know if I would take it if she wanted to give it to me for free.

Thanks again for your insights, you were right about the comps, they are useless unless you can compare two houses on the same block. While Baltimore undoubtly has some great investing potential, for now I think I will limit my activities to the friendly confines of the DCMETRO area.

Regards,

Gerald

import · June 18, 2001, 10:40pm

Re: Baltimore wholesale question - Posted by Nate(DC)

Posted by Nate(DC) on June 18, 2001 at 22:40:23:

Gerald,

I wouldn’t take a house in that neighborhood for free. You’d have to pay me a lot of money to take it.

Why?

Simple. There is no market for these houses. No one in their right mind would want to buy it, or even rent in the neighborhood. Unless massive changes (larger than an individual investor could bring about…i.e. something the city and/or hospital does) occur, there will never again be a market for these houses. I wouldn’t want the holding costs of this property eating me alive while I wait for that to happen. I’m sure your seller doesn’t either, but don’t make her problem your problem!

Seriously, if you have $2000 to waste, at least buy something you will enjoy!

Nate