In the following article, we will take a brief look at two markets that are close in proximity but different in many other ways. These differences will sometimes determine the approach a homeowner will take if they are thinking about renting their home or if they are an investor looking into purchasing a rental property in either market.
What’s the Difference Between the Baltimore & York Rental Markets?
The York, PA and Baltimore, MD rental markets have some similarities as well as some significant differences, even though they are less than an hour apart from each other. The population in York City is just over 40,000 people while the population in York County, PA is near 450,000. In comparison, the Baltimore City population is just over 600,000 while the population for Baltimore County is in the mid 800,000 range.
The most glaring difference between the two markets, other than the population gap, would be the average rent an investor or homeowner will receive for the area. York will typically have an average rent in the low to mid $900 range while Baltimore has an average rent in the low to mid $1200 range. This may not seem like a lot, but we should remember that these are only averages. In the York, PA market, we can, in some cases, see rent dip into the low $400 range, which makes owning a successful rental property somewhat challenging given that the principal, interest, taxes, and insurance (PITI) for the property may exceed the net rental income. Each market typically will see rental increases of 1-2% per year, respectively.
Median Home Prices & Income Levels
Other differences are the median home prices and income levels for the two markets. York will have a median income level in the low to mid $60,000 range while the median income level for the Baltimore area is in the mid to high $70,000 range. York County, on the other hand, has a median home price of around $170,000 while Baltimore County has a median home price of $240,000 on average.
Public School Systems
The public school system will often be a huge factor for a prospective buyer of a home, and we have seen this translate equally into the rental markets in the York area. When tenants who are now parents begin to think about quality education for their children, they will look for areas that have public school systems with better than average ratings. For those that are longtime residents of the York area, they will already know the reputations of the various school districts. However, for people that are new to the area, they will typically rely on the internet, word of mouth, or their realtor of choice to guide them in choosing an area that may best suit their educational needs. Due to these factors, investors may seek rental homes in these perceived areas as well. They may also need to pay more for these rental home opportunities, and there may be times when the rental income vs. the cost of the home may not correlate equally.
The York, PA & Baltimore, MD Rental Market Remains Strong
While York, PA seems to have much lower rent, lower income, and lower home prices compared to Baltimore, the differences in the numbers seem to be relative in each respective market. The school districts in York are a driving factor for many people seeking housing and should, in turn, be a factor for investors or prospective landlords entering the market. Our knowledge of each market shows various differences, but one theme holds true in each; the rental market remains strong even though the regional and national mortgage rates are consistently low, and each market is typically seeing rental increases of 1-2% per year, respectively. Overall, we think that each market will produce success for investors and landlords if proper due diligence is performed.