Investing in Real Estate in the Eastern Panhandle of WV
Liz McDonald 03/02/2017
6 Things to Consider When Developing Your Real Estate Investment Strategy.
As a Realtor®, property manager and real estate investor, I am a big proponent of real estate investment as a wealth strategy. I believe that the Eastern Panhandle of West Virginia is a fertile market for prudent real estate investment.
Why Invest in Real Estate in the Eastern Panhandle of WV
Incomes in Charles Town, Harpers Ferry, and Shepherdstown in Jefferson County WV are higher than state-wide average, largely due to the Federal jobs in the area and the close proximity to Maryland’s I270 Technology Corridor, Northern Virginia, and DC job markets. Jefferson County, in the Eastern Panhandle of WV, is where people working in Frederick and Montgomery Counties in Maryland, Northern Virginia, and DC Metro Area are moving to get the life-style they want.
Martinsburg and Inwood in Berkeley County, WV provide surprisingly low priced housing considering the steady manufacturing jobs right there along the I81 corridor in easy commuting distance. That higher than average income level, mixed with reasonably-priced rental stock and lower taxes, makes WV a great place to invest in real estate. It is a great financial move, no matter what your strategy.
Eager to Invest in Real Estate in the Eastern Panhandle of WV
The other day I got a call from someone interested in a real estate investment opportunity in the Charles Town, WV area. This potential real estate investor was attracted to an auction of a property sight-unseen and wanted to know my opinion of value and my assessment of the investment. Having a Realtor® who understands real estate investment and the local area can be a huge benefit to a real estate investor.
Knowing there are multiple real estate investment opportunities, I told him I would be happy to send him additional options that may be a fit for him. “Great,” I told him. “Let me know what investment criteria you have and I am happy to pull some listings that might be a fit for you.” Silence. “For instance, what is your price range? Are you willing to do some rehab, or does it need to be move-in ready?” Silence.
I wasn’t challenging this real estate investor; I was simply trying to be as useful as possible. These are answers that are helpful as a Realtor® so I can know how to be the most help to a real estate investor.
How Can a Realtor Help You with Real Estate Investment in the Eastern Panhandle of WV
I work with one real estate investor who will only look at houses that are under $50,000 with a structural issue that he can take care of. Another real estate investor client is interested in buying a significantly under-valued house in the $300-500,000 range to live in, add value to, and sell in the 3-5 year time frame. Yet another real estate investor I work with buys rentals for a long-term real estate investment strategy and has specific return on investment (ROI) requirements for each rental house he buys in the Martinsburg, WV area.
Those are three very different real estate investment styles, but reflect the personality of the client, their personal life, and their risk tolerance. And those real estate investment styles will each make my clients great money and fit in their individual financial plans.
However, it means that I can’t use a one-size fits all plan when I am searching for the right investments for each real estate investor. Let me say it again a different way: A real estate professional who has a strong real estate investment background can be extremely valuable. But without knowledge of your particular real estate investment guidelines and needs, that agent is practically useless.
Developing Your Real Estate Investment Style for the Eastern Panhandle of WV
Before you invest in real estate in Jefferson County or Berkeley County, WV you need to understand your own real estate investment strategy. There are six basic points to consider:
Pricing: What purchase price works best for your real estate investment in the Eastern Panhandle of WV? This may be influenced significantly by your financing, cash on hand, or return on investment criteria.
Location: Do you care where the investment is located? Some real estate investors prefer the I81 corridor for quick access to manufacturing jobs in Berkeley County, WV and Hagerstown, MD or the medical center in Winchester, VA so they want to buy in Inwood, Bunker Hill or Spring Hills (Martinsburg). Other real estate investors prefer Jefferson County for higher rents and proximity to Maryland’s I270 Technology Corridor, Northern Virginia, and DC job markets.
Financing/Cash: Have you spoken with a bank or mortgage broker about the requirements for financing your real estate investment in Charles Town, Harpers Ferry, Shepherdstown, Martinsburg or Inwood WV? Do you know how much you will have to put down to purchase the house? Are you planning to pay in cash, in which case that creates potential limitations on price point?
Rehab vs. Move-in Ready: Some real estate investors prefer to rehab an undervalued house that they can make a premium on. Others want to avoid the headaches of rehab and simply buy a move-in ready home in the Eastern Panhandle of WV that they can rent immediately and make a profit from.
Exit Strategy: Most of my clients are plan to hold their real estate investment in Jefferson County and Berkeley County WV for at least a few years (That is probably at least partly because we are a property management company as well, which gives our clients great peace of mind in investing). However, rehab and flip vs. selling a house in 3 years to reinvest in something else vs. paying the home off over time to provide rental income in retirement, are all very different strategies and require different planning at the purchase.
Self-Manage vs. Use a Property Manager: This probably will impact where you buy real estate investment to use a rental. If you plan to use a property manager (and I know an excellent company for that!), you want to work in the management expense to your calculations.
That is just the surface of criteria to consider for real estate investment, but you get the idea. The more I understand your objectives in buying a real estate investment property, the more use I can be to a real estate investor. Specific circumstances can create great deals and you just have to be in the market. If you are considering real estate investment in the Eastern Panhandle of WV, give us a call. We are happy to help.
Disclaimer: We are not financial planners, lawyers, or CPAs. This article should not be considered as advice in those areas.