You’ve finally found the perfect rental property for your rapidly growing Howard County property management business, but maybe you have a few questions about the area you found it in.
How safe is the neighborhood? What demographic will be attracted to living in this area? What should a landlord really know about the community?
It’s time to do your homework.
Before making any major, potentially life-changing investment like purchasing a rental property, you need to be sure you’re choosing the right option. Here’s a helpful guide from our Howard County property management team to help you learn about everything you need to know before investing in a rental property.
How Landlords Can Learn About a Neighborhood Before Purchasing Property
Talk to Others in the Community
Neighborhoods in Howard County, MD are growing and improving every year. The value of residential properties in the area is likely to continue rising, and currently, mortgage rates are low in the state of Maryland. In other words, you can relax a bit – you’re making a solid choice for the general location of your rental property.
But, you should still be thorough while researching the specific area where your property is located. Engage with other members of the community by involving yourself in neighborhood events early on in your decision-making process. Don’t be intrusive, but take advantage of every opportunity to speak to your potential neighbors.
Ask their honest opinions of the neighborhood.
Do they know of any recent crimes in the area? Are there new development projects coming to the surrounding are that will bring new businesses and more people?
By determining what will make the biggest impact on the future of the area, you’ll have a better understanding of what the next few years will look like for your Howard County property management business.
Visit at Different Times
When you drive through a neighborhood during the daytime, you might have a different mental picture of the area than you would if you drove through at night.
What is the neighborhood like after-hours? Are there people walking the streets in the gloom of old streetlights? Does it look run-down, or even creepy, at night? Is it noisy with the hustle and bustle of party-goers and booming bass speakers, or could you hear a pin drop in the eerie silence?
While you may not realize at first, taking into consideration the visual and auditory aesthetics of a neighborhood at night can be extremely important to your future tenants. No one wants to move into a new area where they don’t feel safe and comfortable living.
Tip: For more information on ways to keep your future tenants comfortable and happy with you as a landlord, check out this blog post!
Read the Newspaper
If the neighborhoods in Howard County, MD where you’re considering purchasing a rental property are larger and more culturally rich (more nightlife or regular community events), they may have their own newspaper/newsletter for local stories. If not, find a newspaper from the surrounding area and investigate.
The more important section to you as a future landlord is the “police blotter” or any sort of jail log or crime information made available to the public. Get a sense of the troubles facing the local community, and try to identify whether any of these problems originate in the immediate area of your future rental property.
If there is an “Ask the Editor” section, try and gauge the feelings of members of the community. Read their comments and concerns, and find out what issues are affecting the neighborhood.
Sometimes, you may not be able to find many specifics regarding the exact location of your rental property, so utilize Google to search for recent events and organizations in the area and spend some time researching them. You might even find blogs and newsletters available exclusively online that detail everything you’re looking for about your future neighborhood.
Now that you’ve gotten a general sense of the area from discussing the concerns of local citizens and getting a finger on the pulse of the community, it’s time to dig a little deeper.
Using the Trulia Map Tool, you can find a far more complete breakdown of an area. This awesome web-based information tool allows you to research:
- Crime rates by total reported incidents, with an estimate of risk
- Education availability, including estimated access to all levels of schooling
- Commute times to business districts in the surrounding area, including public transit
- Amenities, including restaurants, grocery stores, nightlife, cafes, shopping centers, beauty salons, and the arts
- Affordability estimates, including averages of pricing on homes and businesses, square footage, etc.
- Demographic breakdowns based on the median age, married/unmarried populations, percentage of college graduates, and estimates on the age of buildings, homes, and other structures
- Hazards, including risks of earthquakes, floods, tornadoes, hurricanes, and wildlife
Outside of what Trulia details, you should also look into property taxes for your own purposes to know how much money you’ll be giving to the government. Explore the local job market too so you can learn what sort of access your tenants will have to employment. And don’t forget to find out if the neighborhood has a peculiarly high number of listings and vacancies – this could indicate some further concerns.
Another among the more common concerns of renters is the pricing of utilities in the area. While it’s true that as a Howard County landlord you can make many steps to reduce the utility costs on your properties, it’s still a great idea to have an estimate available to potential renters.
What About Real Estate Agents?
The person or team responsible for selling you the rental property will most likely not be the best source of information to help you determine what is a “good” or “bad” neighborhood.
This isn’t because they’re dishonest – it’s simply conflict of interest. In fact, it’s illegal for a real estate agent to recommend neighborhoods based on their opinions of what a “good” neighborhood is.
Doing so would be considered steering, and could lead to difficulties with local property values. For instance, if a real estate agent expressed a high opinion of one area over another to each of the customers, there would be an influx of people purchasing properties in that area. This could push up the values in that area while disproportionately lowering values elsewhere.
Regardless of what you’re looking for in your rental property business, all of these tips for performing research into neighborhoods in Howard County, MD can be instrumental to your success.
While every city has its good neighborhoods, you’ll have to spend some time and effort to find the perfect location. Otherwise, you could end up purchasing a property that isn’t profitable, which will have a negative effect on your rental property business.
If you have more questions about what it means to have a Howard County property management business, contact the experts at Bay Management Group today. Now only can we share our knowledge of the surrounding areas – we can also assist you with all of your other investment property needs.