Looking to start investing in the Pittsburgh area
Investor · CA · Member since 2008 · 91 posts · 10 votes
Looking to start investing in the Pittsburgh area
Most Popular Reply
River SavaPro Member
Lender · USA · Member since 2022 · 1k+ posts · 1k+ votesDefinitely check out meetup.com I have done a lot of events through the website, and it is excellent! A lot of investors use it to network both in person and virtually. I would love to connect with you as well!
26 Replies
- Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes3y
Quote from @Reggie Smith:
Go to NETWORK at the top of your screen and you can search for other investors and investment groups in your area. You can also check meetup.com or search facebook for real estate investment groups, clubs, or meetings in your area.
The DIY Landlord Book4.7248 Reviews - 3yJeremy TaggartBusiness MemberReal Estate Agent · Pittsburgh, PA · Member since 2014 · 850 posts · 646 votes
@Reggie Smith SFR's you can get for 70-120k, Multis about 40-70k/unit. 1.25-1.5% rent/price ratios. I think there is value in buying in the nice pockets of the lower income areas. I have a few like that in my portfolio and they've performed well. We also have decent areas outside the city that are more cash flow friendly than similar quality areas in the city.
DHRE- The Jeremy Taggart Team590 Reviews - 3yLiam TenniesPro MemberReal Estate Agent · Pittsburgh, PA · Member since 2020 · 44 posts · 40 votes
Typically we, as investor agents, don't recommend going into D or C- class areas given the management headaches they come with and the amount of repairs & maintenance they require, but if you have done it before and know what you're getting into, that's the biggest thing, so go for it!
I have to agree with my colleague @Jeremy Taggart on this. You can get the higher cash flow from those areas by looking at the better pockets of the not-so-good neighborhoods. Say you're looking at a C class neighborhood with good cash flow that is a bit rougher - look for the 1 or 2 streets within that neighborhood that are the nicest or least run down. You will get the lower prices that exist in the neighborhood but likely get better tenants & less headaches if you look for pockets like this. Pittsburgh is very street by street, so you can take advantage of that.
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Nathan Gesner:
Quote from @Reggie Smith:
Go to NETWORK at the top of your screen and you can search for other investors and investment groups in your area. You can also check meetup.com or search facebook for real estate investment groups, clubs, or meetings in your area.
Natha...thanks
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Jeremy Taggart:
@Reggie Smith SFR's you can get for 70-120k, Multis about 40-70k/unit. 1.25-1.5% rent/price ratios. I think there is value in buying in the nice pockets of the lower income areas. I have a few like that in my portfolio and they've performed well. We also have decent areas outside the city that are more cash flow friendly than similar quality areas in the city.
Jeremy thanks. Buying in the nicer pockets of lower income areas have been my thing in the past...are there any lower income areas that you can suggest? I would also be open to decent areas outside of the city,do you have any recommendations? Thoughts on Alquippa? Thanks again.
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Liam Tennies:
Typically we, as investor agents, don't recommend going into D or C- class areas given the management headaches they come with and the amount of repairs & maintenance they require, but if you have done it before and know what you're getting into, that's the biggest thing, so go for it!
I have to agree with my colleague @Jeremy Taggart on this. You can get the higher cash flow from those areas by looking at the better pockets of the not-so-good neighborhoods. Say you're looking at a C class neighborhood with good cash flow that is a bit rougher - look for the 1 or 2 streets within that neighborhood that are the nicest or least run down. You will get the lower prices that exist in the neighborhood but likely get better tenants & less headaches if you look for pockets like this. Pittsburgh is very street by street, so you can take advantage of that.
Liam thanks. This is exactly what I typically like to do...find those streets in the neighborhood that are the nicest. I understand that Pittsburgh is street by street...any areas/neighborhoods that you recommend I start researching? Thanks.
- Investor · Member since 2021 · 591 posts · 695 votes3y
@Reggie Smith I don't have an answer for you, but I do have a question...
You mentioned that you've had some success with OOS investing in C and D areas. Normally, the biggest trainwreck stories we hear on BP forums are from OOS investors with properties in C and D areas (e.g.; we hear stories about non-paying tenants, trashed properties, crime, etc.). One of the most common stories we hear from OOS C and D investors is that their PM is non-responsive (which makes sense when you consider no PM in their right mind would put in the serious amount of work it would take to correctly manage a D property in exchange for the minimal management fee that a single fam or small multifam D property would produce...it's just not worth the effort to most PMs).
So, my question is: how were you able to succeed as an OOS investor in C and D properties, when most people fail? ...it sounds like maybe you've learned something valuable that we could all benefit from...
Thanks!
- Real Estate Agent · Pittsburgh, PA · Member since 2015 · 1k+ posts · 846 votes3y
Quote from @Reggie Smith:
I'm interested in investing in the Pittsburgh area looking for C class areas perhaps even some areas that are D+...I'm really focused on cash flow. I have some experience investing out of state...Detroit,St. Louis,KC, Atlanta. Some of the properties I purchased in these cities were in rough areas and I did ok as I wasn't in the heart of the madness and some of the areas actually turned around. Curious to know of some areas that I should look into and what are some realistic price-points for buying in these areas. Thanks.
You’re going to struggle in these areas in Pittsburgh if you aren’t local.
There’s not a property management company strong enough in the city that is actually going to want to handle this for you.
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Leo R.:
@Reggie Smith I don't have an answer for you, but I do have a question...
You mentioned that you've had some success with OOS investing in C and D areas. Normally, the biggest trainwreck stories we hear on BP forums are from OOS investors with properties in C and D areas (e.g.; we hear stories about non-paying tenants, trashed properties, crime, etc.). One of the most common stories we hear from OOS C and D investors is that their PM is non-responsive (which makes sense when you consider no PM in their right mind would put in the serious amount of work it would take to correctly manage a D property in exchange for the minimal management fee that a single fam or small multifam D property would produce...it's just not worth the effort to most PMs).
So, my question is: how were you able to succeed as an OOS investor in C and D properties, when most people fail? ...it sounds like maybe you've learned something valuable that we could all benefit from...
Thanks!
I have got my butt kicked here and there. I'm not sure who remembers but back in roughly 2006 there was a St. Louis property management company that was highly recommended...even Joshua Dorkin was using the PM. Long story short...they were cooking the books. Many of us lost $$$. So I learned to be a little more hands on by building real relationships with locals in the area that I was looking to invest in. I've bought properties site unseen...so usually I would pay a handyman or home inspector to take pics for me,let me know what's going on in the area etc. The relationship grows as I find out more about them they find out more about me...and I figure out how can help them with what it is that they are trying to do. I've built relationships where my home inspector or handyperson became my project manager. If the handyperson or inspector was willing to go into some of these rougher areas,they typically were able to refer me to an agent,PM or someone who could connect me with someone who is working in the area...perhaps this person grew up in the area and still has local ties etc. So often I was eventually able to connect with someone...who was new, hungry, looking to cut there teeth and perhaps own or manage 2-3 rentals in the area. They tend to be able to provide really good local market insight. I think that its key to build relationships with people who know these areas on a personal level.
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Anthony Angotti:
Quote from @Reggie Smith:
I'm interested in investing in the Pittsburgh area looking for C class areas perhaps even some areas that are D+...I'm really focused on cash flow. I have some experience investing out of state...Detroit,St. Louis,KC, Atlanta. Some of the properties I purchased in these cities were in rough areas and I did ok as I wasn't in the heart of the madness and some of the areas actually turned around. Curious to know of some areas that I should look into and what are some realistic price-points for buying in these areas. Thanks.
You’re going to struggle in these areas in Pittsburgh if you aren’t local.
There’s not a property management company strong enough in the city that is actually going to want to handle this for you.
Anthony WOW...that's a pretty strong statement,thanks for the insight
- Investor · Member since 2021 · 591 posts · 695 votes3y
Quote from @Reggie Smith:
Quote from @Leo R.:
@Reggie Smith I don't have an answer for you, but I do have a question...
You mentioned that you've had some success with OOS investing in C and D areas. Normally, the biggest trainwreck stories we hear on BP forums are from OOS investors with properties in C and D areas (e.g.; we hear stories about non-paying tenants, trashed properties, crime, etc.). One of the most common stories we hear from OOS C and D investors is that their PM is non-responsive (which makes sense when you consider no PM in their right mind would put in the serious amount of work it would take to correctly manage a D property in exchange for the minimal management fee that a single fam or small multifam D property would produce...it's just not worth the effort to most PMs).
So, my question is: how were you able to succeed as an OOS investor in C and D properties, when most people fail? ...it sounds like maybe you've learned something valuable that we could all benefit from...
Thanks!
I have got my butt kicked here and there. I'm not sure who remembers but back in roughly 2006 there was a St. Louis property management company that was highly recommended...even Joshua Dorkin was using the PM. Long story short...they were cooking the books. Many of us lost $$$. So I learned to be a little more hands on by building real relationships with locals in the area that I was looking to invest in. I've bought properties site unseen...so usually I would pay a handyman or home inspector to take pics for me,let me know what's going on in the area etc. The relationship grows as I find out more about them they find out more about me...and I figure out how can help them with what it is that they are trying to do. I've built relationships where my home inspector or handyperson became my project manager. If the handyperson or inspector was willing to go into some of these rougher areas,they typically were able to refer me to an agent,PM or someone who could connect me with someone who is working in the area...perhaps this person grew up in the area and still has local ties etc. So often I was eventually able to connect with someone...who was new, hungry, looking to cut there teeth and perhaps own or manage 2-3 rentals in the area. They tend to be able to provide really good local market insight. I think that its key to build relationships with people who know these areas on a personal level.
@Reggie Smith that's some good feedback, and it sounds like you've been through some challenges...getting involved in a PM company that cooks the books sounds like a nightmare scenario--sorry you had to experience that (though, I'm guessing you learned a lot from it).
What would you say are the biggest lessons you've learned as an OOS investor?
...Also, I thought about your question about Pittsburgh...I don't currently own any property there, but I grew up around the area, and I know the city fairly well... I'd suggest asking some local pros what their thoughts are about the Polish Hill neighborhood.
Most of Polish Hill has been in pretty rough shape for a while, BUT, it's one of the most central neighborhoods in the city and is surrounded on nearly all sides by pretty desirable neighborhoods, all of which are very nearby (Bloomfield, Lawrenceville, Oakland, downtown, the strip district)...
I've always wondered why Polish HIll has struggled when the surrounding areas have done pretty well, and I've always thought that it could could have potential to make a comeback--maybe a PGH pro on here can fill us in on that....
...for the last couple years, I've been thinking about trying to break into the PGH market myself--it's a great city, with a lot going for it...but adding OOS properties is obviously a big challenge (currently, all my properties are local to me)...and I DEFINITELY wouldn't have the guts to go after C and D OOS properties lol.
I'll be interested to hear which neighborhoods you end up focusing on @Reggie Smith
Good luck!
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Leo R.:
Quote from @Reggie Smith:
Quote from @Leo R.:
@Reggie Smith I don't have an answer for you, but I do have a question...
You mentioned that you've had some success with OOS investing in C and D areas. Normally, the biggest trainwreck stories we hear on BP forums are from OOS investors with properties in C and D areas (e.g.; we hear stories about non-paying tenants, trashed properties, crime, etc.). One of the most common stories we hear from OOS C and D investors is that their PM is non-responsive (which makes sense when you consider no PM in their right mind would put in the serious amount of work it would take to correctly manage a D property in exchange for the minimal management fee that a single fam or small multifam D property would produce...it's just not worth the effort to most PMs).
So, my question is: how were you able to succeed as an OOS investor in C and D properties, when most people fail? ...it sounds like maybe you've learned something valuable that we could all benefit from...
Thanks!
I have got my butt kicked here and there. I'm not sure who remembers but back in roughly 2006 there was a St. Louis property management company that was highly recommended...even Joshua Dorkin was using the PM. Long story short...they were cooking the books. Many of us lost $$$. So I learned to be a little more hands on by building real relationships with locals in the area that I was looking to invest in. I've bought properties site unseen...so usually I would pay a handyman or home inspector to take pics for me,let me know what's going on in the area etc. The relationship grows as I find out more about them they find out more about me...and I figure out how can help them with what it is that they are trying to do. I've built relationships where my home inspector or handyperson became my project manager. If the handyperson or inspector was willing to go into some of these rougher areas,they typically were able to refer me to an agent,PM or someone who could connect me with someone who is working in the area...perhaps this person grew up in the area and still has local ties etc. So often I was eventually able to connect with someone...who was new, hungry, looking to cut there teeth and perhaps own or manage 2-3 rentals in the area. They tend to be able to provide really good local market insight. I think that its key to build relationships with people who know these areas on a personal level.
@Reggie Smith that's some good feedback, and it sounds like you've been through some challenges...getting involved in a PM company that cooks the books sounds like a nightmare scenario--sorry you had to experience that (though, I'm guessing you learned a lot from it).
What would you say are the biggest lessons you've learned as an OOS investor?
...Also, I thought about your question about Pittsburgh...I don't currently own any property there, but I grew up around the area, and I know the city fairly well... I'd suggest asking some local pros what their thoughts are about the Polish Hill neighborhood.
Most of Polish Hill has been in pretty rough shape for a while, BUT, it's one of the most central neighborhoods in the city and is surrounded on nearly all sides by pretty desirable neighborhoods, all of which are very nearby (Bloomfield, Lawrenceville, Oakland, downtown, the strip district)...
I've always wondered why Polish HIll has struggled when the surrounding areas have done pretty well, and I've always thought that it could could have potential to make a comeback--maybe a PGH pro on here can fill us in on that....
...for the last couple years, I've been thinking about trying to break into the PGH market myself--it's a great city, with a lot going for it...but adding OOS properties is obviously a big challenge (currently, all my properties are local to me)...and I DEFINITELY wouldn't have the guts to go after C and D OOS properties lol.
I'll be interested to hear which neighborhoods you end up focusing on @Reggie Smith
Good luck!
One of the biggest lessons I learned as OOS is you still have to be very much hands on...you have to manage the property manager. Building local relationships, treating people well...I've built some great relationships over the years and I don't take them for granted. When PM or contractors know you have someone local who is knowledgeable it makes a big difference. I have been very fortunate.
- Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes3y
Quote from @Reggie Smith:
I'm interested in investing in the Pittsburgh area looking for C class areas perhaps even some areas that are D+...I'm really focused on cash flow. I have some experience investing out of state...Detroit,St. Louis,KC, Atlanta. Some of the properties I purchased in these cities were in rough areas and I did ok as I wasn't in the heart of the madness and some of the areas actually turned around. Curious to know of some areas that I should look into and what are some realistic price-points for buying in these areas. Thanks.
Reggie, I'm not affiliated with the DHRE players like @Jeremy Taggart and @Anthony Angotti, but I know them. I would suggest you listen to their advice carefully.
I keep trying to tell people that Pittsburgh tends to be a bit more complicated that other cities its size because of the geography and the politics. We have more bridges than any other city in the world, including Venice, Italy. The politics are hopelessly corrupt. There are incredible financial inequalities. The racial issues are like nothing I've ever seen or heard of before. I've been here since 2007 and I can say I only know two or three small areas in the city very well. Much of the rest is still a mystery to me, even now. Get real boots on the ground. Don't trust anyone from north of the rivers to work well with anyone from south of the rivers, and vice versa. Don't ever say anything uncomplimentary about this city to a native -- they'll remember it forever and hold it against you forever. Never, ever, ever, ever suggest that Pittsburgh's best days are in the past, no matter how clear it is to you.
You're absolutely right. The kind of investing you're talking about happens all the time here. I'll go out on a limb and suggest that the Hazelton neighborhood has a great chance of doing better in the near future, not MUCH better, but better. I'd say that if you want a Hail Mary play, look to Rankin Borough. If you want a sure thing, you're out of luck. - Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Jim K.:
Quote from @Reggie Smith:
I'm interested in investing in the Pittsburgh area looking for C class areas perhaps even some areas that are D+...I'm really focused on cash flow. I have some experience investing out of state...Detroit,St. Louis,KC, Atlanta. Some of the properties I purchased in these cities were in rough areas and I did ok as I wasn't in the heart of the madness and some of the areas actually turned around. Curious to know of some areas that I should look into and what are some realistic price-points for buying in these areas. Thanks.
Reggie, I'm not affiliated with the DHRE players like @Jeremy Taggart and @Anthony Angotti, but I know them. I would suggest you listen to their advice carefully.
I keep trying to tell people that Pittsburgh tends to be a bit more complicated that other cities its size because of the geography and the politics. We have more bridges than any other city in the world, including Venice, Italy. The politics are hopelessly corrupt. There are incredible financial inequalities. The racial issues are like nothing I've ever seen or heard of before. I've been here since 2007 and I can say I only know two or three small areas in the city very well. Much of the rest is still a mystery to me, even now. Get real boots on the ground. Don't trust anyone from north of the rivers to work well with anyone from south of the rivers, and vice versa. Don't ever say anything uncomplimentary about this city to a native -- they'll remember it forever and hold it against you forever. Never, ever, ever, ever suggest that Pittsburgh's best days are in the past, no matter how clear it is to you.
You're absolutely right. The kind of investing you're talking about happens all the time here. I'll go out on a limb and suggest that the Hazelton neighborhood has a great chance of doing better in the near future, not MUCH better, but better. I'd say that if you want a Hail Mary play, look to Rankin Borough. If you want a sure thing, you're out of luck.Jim....thanks. I really appreciate your feedback,very helpful.
- 3yJeremy TaggartBusiness MemberReal Estate Agent · Pittsburgh, PA · Member since 2014 · 850 posts · 646 votes
Quote from @Reggie Smith:
Quote from @Jeremy Taggart:
@Reggie Smith SFR's you can get for 70-120k, Multis about 40-70k/unit. 1.25-1.5% rent/price ratios. I think there is value in buying in the nice pockets of the lower income areas. I have a few like that in my portfolio and they've performed well. We also have decent areas outside the city that are more cash flow friendly than similar quality areas in the city.
Jeremy thanks. Buying in the nicer pockets of lower income areas have been my thing in the past...are there any lower income areas that you can suggest? I would also be open to decent areas outside of the city,do you have any recommendations? Thoughts on Alquippa? Thanks again.
@Reggie Smith Aliquippa is actually one I own a property in a nicer pocket of haha. There are a couple sections there that can work. Really any of the neighborhoods have nice and not so nice sections so hard to give specific ones but they all can work. It's really more property/deal dependant rather than neighborhood specific. Buying outside the city you stand a better chance at cash flow in nicer areas. So if cash flow is the goal I tend to lean towards outside city for that reason.
DHRE- The Jeremy Taggart Team590 Reviews - 3yRiver SavaPro MemberLender · USA · Member since 2022 · 1k+ posts · 1k+ votes
Definitely check out meetup.com I have done a lot of events through the website, and it is excellent! A lot of investors use it to network both in person and virtually. I would love to connect with you as well!
- Rental Property Investor · Pittsburgh, PA · Member since 2018 · 40 posts · 16 votes3y
@Leo R. I lived in Polish Hill about a dozen years ago and live close to it now. Its built into a steep hillside with less-than-average quality housing stock for the area. Many of the streets are a PITA to drive through because they are small and there are few driveways. Rents have been and continue to be low for the East End as well.
That said, it's a great neighborhood and there has been some development (new build/ major rehabs), but it has fallen behind the rest of the area's appreciation for the past few years. I assume it has to do with geography. It's not a super easy walk to the other neighborhoods you mentioned, and there is only so much going on in Polish Hill itself. I would buy there for cashflow, not appreciation. I would not plan on getting top rent dollar for a nice rehab. And I would be careful comping rents from outside the neighborhood.
- Investor · Member since 2021 · 591 posts · 695 votes3y
Good point about comps @Bill Brown --Polish Hill is definitely its own thing compared to the surrounding areas, and can't be comped against the surrounding neighborhoods...
Yes--the topography is tricky...but, that's a double-edged sword--it gives it great views, and gives the neighborhood character (some of the most expensive real estate on earth is on similarly rugged topography, with narrow PITA streets)... plus, it's so central, and so close to all the surrounding desirable neighborhoods, it just seems like it should have potential. ...but, I've been saying that for years, and I've apparently been mostly wrong about its potential... :(
Man, I miss PGH...the most underrated city in America, IMO!
- Realtor · San Jose, CA · Member since 2015 · 318 posts · 154 votes3y
Interesting post @Reggie Smith thanks. If you’re interested in C- and D areas, I am curious why not focus on the ones in your city in Oakland?
Is there a reason OOS is more favorable? - 3yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
@Reggie Smith why did you stop investing in Detroit?
Logical Property Management4.9458 Reviews - 3yDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
@Jim K. we should chat sometime and share stories about Detroit and Pittsburgh!
Logical Property Management4.9458 Reviews - 3yElise Bickel TauberBusiness MemberReal Estate Agent · Cranberry Twp · Member since 2017 · 384 posts · 198 votes
Just thought I'd throw in my two cents. When I talk to investors about purchasing investments in C- and D areas we have the discussion about the risk. That is what this comes down to. There are investors who love A areas that barely (or sometimes doesnt at all) cash flow. The cost to purchase the property is so high compared to the rent cost that I dont understand how it makes sense. But those investors like the idea that someone will pay their mortgage and expenses while the property they purchase increases in price and that is how they build equity. The A+ areas are very low risk and they are happy with slow and steady. Most investors I would with like B/C areas where the risk is minimal. You are going to have relatively good tenants, get a little cash flow each month, and the properties are increasing in value. C- and D areas are like putting it all on Red. It's 50/50 if you are going to walk away doubling your money or loose it all. When we are working in these areas from a management perspective you have to be very very thorough when screening tenants. It's more than just credit score. Look at their job history. Do they jump jobs? Are they moving rentals constantly? These are indicators of someone who wont be a solid/stable tenant. And more importantly then anything, you need to absolutely make sure the management company you have in place is aggressive. Are they walking the property 4 times a year? Are they filing eviction the very first day they can and when they win filing possession the very first day they can? You need a company that is on top of it so that when the not great tenants slip through, you can get it rectified asap.
I do agree there is a lot of politics involved, areas do go street by street, and you can't overimprove in these areas.
Hopefully that all helps!
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Drew Sygit:
@Reggie Smith why did you stop investing in Detroit?
Of the 2 people there that I formed a good relationship,one developed a serious health condition and the other moved out of the area and started a new business. With that happening and things picking up in Atlanta...I just focused more on Atlanta
- Investor · CA · Member since 2008 · 91 posts · 10 votes3y
Quote from @Osazee Edebiri:
Interesting post @Reggie Smith thanks. If you’re interested in C- and D areas, I am curious why not focus on the ones in your city in Oakland?
Is there a reason OOS is more favorable?City of Oakland...county of Alameda not landlord friendly,rent control...when you want to sale there is usually a hefty cash for keys price,$25k-$50k easy. Also there is no real cash flow
- Realtor · San Jose, CA · Member since 2015 · 318 posts · 154 votes3y
Quote from @Reggie Smith:
Quote from @Osazee Edebiri:
Interesting post @Reggie Smith thanks. If you’re interested in C- and D areas, I am curious why not focus on the ones in your city in Oakland?
Is there a reason OOS is more favorable?City of Oakland...county of Alameda not landlord friendly,rent control...when you want to sale there is usually a hefty cash for keys price,$25k-$50k easy. Also there is no real cash flow
Makes sense. But what about the appreciation? Overtime that would trump cash flow no?
Join the conversationCreate a free account to reply, vote on answers and follow this thread.