Finding the perfect property in Hampton Roads (or anywhere for that matter) can be difficult (even discouraging) if you don’t know what to look for. The key to unlocking profitability lies in understanding the neighborhood and knowing ahead of time what factors will influence the ultimate value of your investment.
Finding the Right Neighborhood
The first step to successful real estate investment in Hampton Roads is finding the neighborhood that’s right for you. Ideally, you’ll want something up-and-coming, a neighborhood near an urban center that’s currently undergoing a transition for the better.
But these neighborhoods aren’t always easy to find - oftentimes, by the time you’ve already heard about a neighborhood with profitable investment opportunities, you’ll have already missed out on the best deals. The key here is to pay attention to development projects that are on the horizon - where are people planning to invest money, and what’s the timeline for change? For instance, there’s been talk of rebuilding much of the St. Paul’s neighborhood in Norfolk for some time. Plans haven’t been approved yet, but if they go through, knowing a few years ahead of time where investor money will be going can get you on the ground floor of change in a neighborhood.
Another thing to consider when looking for the right neighborhood to invest in is to look in the not so obvious places. For instance, Virginia Beach often gets overlooked as a location with limited upside, as it’s already well-established and has a higher average sale price than many of the surrounding areas. The reality, though, is that Virginia Beach has a high potential for profitability: Home prices have remained level over the past few years, it has a developed infrastructure to make life easier for residents, and it sees a steady stream of tourists every year, meaning demand for rental properties will remain high for the foreseeable future.
Aim For Good, Not Perfect
Another thing to note when looking at neighborhoods in Hampton Roads is that you’re looking for something really good - not necessarily something perfect.
Think of it this way - people know where the best neighborhoods are. They bought the property because it has a great commute, great schools, and great amenities for people who live there. Where people often miss the true gems are in the good (but not perfect) neighborhoods. Places where schools are pretty good, but there’s also access to alternatives like private school or charter schools. Where there isn’t necessarily a subway line, but there is a bus line or a nearby highway with access to the local employment hub.
It’s in neighborhoods like these where homes can often be undervalued, or where you might find a good deal on a low-quality home in a high-quality location. Driving through, you might notice a mix of new and old construction, signaling that investors are still putting money into the neighborhood. A quick check online may also reveal that many properties similar to the one you’re looking at have recently sold in the area, meaning demand is still high enough to warrant investment.
Patience is Key
Above all else, patience is key to finding the best deals in Hampton Roads - you need to be willing to wait for the right property to show up. If you have a project in mind that you’re interested in undertaking, it will help to draw up a business plan ahead of time, and do your due diligence on anyone you plan to work with (contractors, lawyers, government officials, and financiers). That way, when the perfect property comes onto the market, you’ll be fully prepared to move without hesitation and get your investment project underway.
If you’re interested in hearing some other helpful pointers about getting started in the world of real estate investment, you can check out our free ebook Building Your Real Estate Empire: Borrower Basics 101.