Capitalizing on Charm: Investing in Historic Maryland Homes  

One of the great things about living in an area of the country like Maryland is its rich architectural history. Many people don’t realize how old this part of the country is until they can stop and take it all in. After all, this place was the site of the Battle of Antietam, one of the most significant battles in the Civil War.

The state itself is so historically significant that real estate must be approached differently. In other areas of the country, potential buyers are all about modernization. They flock to newer, more sophisticated homes that play to the latest trends each year. In a place like Maryland, prospects have one foot in the future but the other firmly planted in the past. They don’t want to shy away from that historical architecture. They want to embrace it. They just want to do it on their own terms.

Investing in historic Maryland homes offers a plethora of opportunities, but there are a few key considerations to keep in mind. 

The Benefits of Balancing Preservation and Renovation

Again, it’s key to understand that the situation in historic Maryland is totally different than elsewhere in the country. Given the age of many homes, it is not unlikely to come across distressed properties. This factor makes Maryland a prime location for wholesale real estate investors. This investment strategy usually involves going after off-market deals, getting the homeowner to agree to one price, and then finding a buyer to agree to a higher one. The wholesaler keeps the difference as a profit.

However, the line between “distressed” and “historic” is a fine one. More than 90,000 properties are listed on the National Register of Historic Places. For example, most of these homes are not eligible for an addition. When it comes to aesthetic upgrades, they cannot “negatively affect the look and feel” of the property. As a rule of thumb, adding square footage to these homes will be difficult – if not downright impossible, thanks to the local municipality.

Because of that, investors need to focus their efforts on striking a balance between modernizing a property where they can while maintaining its historic integrity. Many investors that flip properties in these areas focus on the preservation aspect. This means they do any work to maintain or repair “existing historic materials.” For rehabilitation, investors must show they are “retaining the property’s historic character.” This can be difficult, especially when it comes to modernization in the name of keeping up with the latest buyer trends.

Delving into the historical significance of the state’s homes highlights their enduring value and appreciation trends. The guide elucidates the benefits of preservation and renovation, emphasizing the balance between modernization and maintaining historical integrity.

The Ins and Outs of Location Considerations

Especially in Maryland, there are two main types of historic properties. Those that fall into this category because they have some type of legitimate historical significance… and those that are simply old. The former tend to make far better long-term investments than the latter.

The types of historical property vary by area. Annapolis is an especially promising area thanks to its proximity to Washington, DC, and its strong military presence. The same is true of nearby Silver Spring. Up north, Frederick is a quaint area that is practically brimming with “old-school charm.”

The closer to Baltimore City, the more likely it is to find properties that are considered “historic” for little more than their age. Beware of distressed properties that are so run down that little can be done to fix them meaningfully.

Risk Mitigation in Maryland Real Estate

When it comes to historic properties, it goes without saying that the home itself will be quite old. It is important to remember that looks can be deceiving.

That is to say; a historic Maryland home might have elegant, classic design sensibilities that give it major curb appeal. It could be filled with examples of the types of exceptional craftsmanship that “they just don’t do anymore.” But beware of essential elements that may need costly repairs, including plumbing, electrical, and foundations.

Especially in this scenario, it is prudent to have a home inspection performed before investing in one of these Maryland homes. Better yet, find an inspector who has extensive experience with historic properties. When it comes time to rehabilitate, it is important to focus on repairs that will provide the best return. Replace those old steel pipes that are prone to flaking and rust. Get rid of that knob and tube wiring that is common throughout the area that dates back to the late 1800s. Check the foundation and the roof, and address any lead paint or asbestos. Maryland law dictates that a seller needs to disclose if there is any lead paint on the property, but don’t take this for granted.

Maryland: A Prime Location Rich With Historical Curb Appeal

In the end, Maryland may be one of the more prominent states in the country with one of the strongest real estate markets, but it’s also unique unto itself. Yes, the state is always active, thanks to its proximity to Washington, DC (and the huge cost of living there). But in many ways, it’s still a niche market and will always be due to the historical benefits (and hurdles) associated with it.

With tips like those outlined above, investors can confidently navigate the unique world of historic Maryland homes. They’ll put themselves in the best possible position to unlock both the timeless allure and the financial rewards, which is an exciting position for any investor to be in.