Given the potential ROI on investment properties here in Northern Virginia, should you consider adding Real Estate holdings to your wealth portfolio?

I’ve been looking at return on investment, or ROI, for an investor. He’s heavy into the stock market and wants to balance out his investment portfolio with real estate. As a ‘what-if’ I ran the ROI on a condo in Roslyn.

Here’s the breakdown:

To sum up the above information:

If you put down $45,000 ($40,000 down and $5,000 in closing costs) on a $160,000 condo, you’re looking at about $8,232 in annual cash flow if you rent out the property.

In addition to that, at a modest 2% appreciation rate, the value of the condo will rise $3,2000 in the first year. That gives you a total return of $11,000 on your initial $45,000 investment in the first year.

So as you can see, real estate is a sound investment here Northern Virginia.

But is it a good time to invest?

Well, I recently had lunch with one of my commercial banker friends, Tom Grantham, with FVCbank. I asked him for his thoughts on the northern Virginia real estate market, and where he thought it was heading. Tom said all the indicators he sees are positive. Our economy is strong due to job growth. And if Amazon’s second headquarters ends up in NVA, it will, as he said, “be interesting.”

His insights are in tune with what I’ve been seeing over the past year: A strong and steady growth that is far more recession-resistant than in the past. In my opinion (and in the opinion of many other experts) real estate is currently one of the soundest investments you can make.

If you want to look at ROI calculators online, the AARP has an investment property calculator that’s easy to use:

That’s all for now. Please feel free to contact me with any real estate or building questions.

Lou Sagatov, Realtor®


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