25 Apr An Investment in Fairfax County that was Just Right
I recently met with my clients, Jen and Derek to discuss the purchase of investment properties. I love those discussions. There’s nothing better than seeing people light up as they envision the benefits of building wealth, diversifying their investment portfolios and achieving financial independence.
Most long-term investors are looking for either a break-even approach or even more ideally, some positive cash flow. The important part of that statement is the long-term aspect. These investors are not interested in flipping houses to make a few bucks, they are parlaying current cash towards real estate in order to achieve long-term investment goals.
After the initial introduction chatter, we started assessing where they should buy their first property. They currently live in Fairfax County and wanted to invest in a property close to their home. Considering the area’s strong rental market and the convenience associated with managing a property nearby, investing in Fairfax was an ideal choice for them.
Fairfax County is a hotbed for real estate. My clients know their local market well and know that buying in this county is going to cost them…but they also know that the average rent is $1640 a month (according to stats released by the Fairfax County Department of Neighborhood and Community Services in 2014). The average purchase price for a single family attached unit, like a townhouse or duplex, costs on average $381,444 based on the same report. We have identified a few areas in Fairfax and Reston that will allow us to stay below the average purchase price but still get close to the average rent of $1600 a month. That’s the trick right? Identifying areas that will both allow you to leverage your initial cash in and are strong rental areas. The median age in Fairfax County is 37.6 years and the median income is $110,674 annually. More than 30% of people living in Fairfax County are renters. In other words…we have a lot of people making really good money who are not willing to settle and buy. As an investor those statistics are very impressive and powerful validation on why Fairfax County overall, is a great area to get your feet wet as an investor.
It’s fair to say that a lot of other factors have to a fall into place to ensure that buying an investment works out the way you envision, will be a good long-term financial decision and ultimately give you the ROI you hoped for.
Derek and Jen have two small children and their other big goal is providing some financial stability to them for the future. It’s fair to say, I found my motivation to ensure this dream will be achieved!