The summer real estate market can make or break the entire year. This is the most active season and the time when real estate prices peak. With summer 2016 quickly becoming a distant memory, let’s review its impact on the local real estate markets. Perhaps most importantly, let’s think what it means for real estate investors planning to use hard money loans in Maryland in the future.
According to data provided by RBI, the prices in the entire Washington, DC area remain stable. The median price for the first six months of 2016 is exactly the same as it was the same period last year. Interestingly, this June’s median prices jumped to an all time high of $446,000. This is great news, since real estate investors like you and I always welcome sustainable appreciation. However, it also means that we live in an area where investing in real estate is profitable, but an expensive business.
Steer away from the most expensive areas.
One of the ways to deal with this challenge is to avoid the most expensive areas both because of their price tag and rarity of distressed properties. Explore more modestly priced counties such as Prince George’s, Frederick and Anne Arundel instead. Those prices have increased, but are still far below the DC area’s average. For example, Prince George’s County’s June’s median price rose to $260,000 from $240,000 in June 2015. Frederick County’s median price jumped to $295,000 from $275,000. Anne Arundel County’s median price climbed to $337,000 from $322,000.
Look for undervalued areas.
Obviously, as in investor using hard money loans in Maryland, you should not be planning to pay the median price. Your goal is to find a property that is priced substantially below it. What you should concentrate on is to find real estate pockets within those counties that are undervalued. These areas might be located in the general vicinity of the booming areas and sometimes literally across the road.
For example, one of such pockets in Montgomery County is Montgomery Village. It’s a beautifully planned community which offers attractive homes literally at a fraction of the cost of its immediate neighbor, Kentlands. Yet, the housing market crisis hit it hard and, ten years later, is still recovering from it. Many properties are distressed and poorly maintained, while others display a true pride of home ownership. If you are looking to invest using hard money loans in Maryland in the future. , this is a great place to check out. There are more areas like this in PG, Frederick and Baltimore counties. For more ideas on investing in Maryland, call us at 240.436.2340.