I'm often asked where is the best place in Northern Virginia to begin investing in real estate. Here I'm talking about "buy and hold" real estate rather than "flipping" houses. Many people in our area flip houses successfully, but this is really about finding a house that needs work, buying it at a deep discount, and then putting the work in to sell it at a top of the market price.
Buying and holding is about finding a place where the real estate will appreciate well over time. Long term trends in Northern Virginia show the area in general appreciating around 4% annually, which means an investment in a house should double every 18 years, on average. If you fund your investment with a loan, you will want the rent to pay for as much of that as possible. Many investors in Northern Virginia find that it's not possible to have all of their expenses paid for by rent the first year of their investment. The good news for investors is that rents have consistently risen in our area as well. They've gone up 55% in the las decade according to the Washington Business Journal. So if the rent doesn't cover the carrying costs the first year, rents should rise to meet them, then exceed them as your investment matures. At the same time your mortgage balance will be going down and the value of your property going up.
If you have the ability and fortitude to deal with physical issues in the house and tenants who will be at times difficult to deal with, real estate in NoVA can be a great long term investment. I think you should focus on areas and house types that will exceed the long-term average of the area in general. Here are a few good opportunities I see right now.
Properties Near Metro Stations. Metro oriented properties were a darling for investors for decades in the DC area. The pandemic changed all that and erased much of the premium that had been on these types of properties previously. For example, at one large condo complex, Marquis at Vienna Station, the average 2-bedroom sold for $404K in 2019 and while the rest of the area saw prices rocket through the pandemic, last year the average 2-bedroom sold for only $421K. This is indicative of properties all along the metro lines. If people go back to working in offices, and back to using public transportation these properties will regain the premium they once had. One neighborhood I'll mention in this space is Bryson at Woodland Park in Herndon, which is well kept, near the new Metro station there along with many amenities and offices, but can be had under $300k.
Well-built townhouses in strong communities. The brick townhouse communities along the beltway should remain popular and prosperous for the next decades. Brick is easy to maintain for you and your neighbors and these places have strong enough HOAs to keep that random house from looking terrible and ruining the neighborhood for everyone. A couple neighborhoods I like in the space are Stonehurst in Fairfax and Charlestown in West Springfield. They both are brick neighborhoods, near plenty of transportation options, and should look good for decades to come.
Established condo communities in Arlington/Alexandria. People continue to flock to neighborhoods like Park Fairfax and Shirlington. These are mostly made of brick, and well cared for as a whole. They should increase steadily in value.
If you are thinking of investing, contact us to set up a call or meeting so we can help you develop a plan to get into the right investment for you.
The accuracy of all information, regardless of source, including but not limited to open house information, square footages and lot sizes, is deemed reliable but not guaranteed and should be personally verified through personal inspection by and/or with the appropriate professionals. The data contained herein is copyrighted by Bright MLS and is protected by all applicable copyright laws. Any unauthorized dissemination of this information is in violation of copyright laws and is strictly prohibited.
Copyright 2024 Bright MLS. All rights reserved.