Lehigh Vally, PA Investing

Rental Property Investor · PA · Member since 2019 · 6 posts · 3 votes

Hi everyone! I started learning about real estate investing about a year ago and am starting to think about property in the Lehigh Valley area of Pennsylvania. My plan is to start with a buy and hold strategy focusing on multi-family properties. With that being said what areas would be best for that in regards to cashflow? I am torn between focusing on Allentown, Bethlehem, or Easton. What are some pros and cons to each of these areas? If anyone could provide any insight that would be great!

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David Ribardo

Real Estate Agent · Allentown, PA · Member since 2016 · 197 posts · 181 votes

@Rachel T. There are good areas and bad areas for investing across all three cities. Each has their own individual nuances that you need to be aware of before purchasing in them. For example, Easton is quite stringent on their Certificate of Occupancy inspections, and Bethlehem is absolutely a terrible place to buy if you want to do short-term AirBNB style rentals. The good thing is that all three cities have major economic drivers that are bringing growth to the area. By positioning yourself along the "path of progress", you can position yourself for above average appreciation and rental demand.

In general - center city Allentown has the best cash flow due to low purchase prices, low taxes, and relatively high rents. Bethlehem has some really high demand for Lehigh University student housing, and we've been having a ton of activity on the south side in that area. It's got moderate purchase prices, taxes, and rents. Easton has the highest taxes and expenses, but also has correspondingly higher rents. Overall, investors are buying at similar cap rates across all three communities. It just comes down to what is the best deal you can find, and which one is the best fit for you.

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Ricardo L Knight
Rental Property Investor · Reading, PA · Member since 2019 · 76 posts · 43 votes
6y
Allentown is seeing tons of development growth downtown their building condos for 2 grand a month so for me that’s where I would start plus they have tons of 3 and 4 units . I love that market . But Bethlehem and Easton are also good too a town 1st for me
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Jeffrey De Los Santos
Rental Property Investor · Easton, PA · Member since 2019 · 38 posts · 9 votes
6y
@Rachel Toubin ive lived in the Lehigh Valley for over 15 years and i also invest here. My focus is mainly Easton, but I also am interested in the Bethlehem area. For multi-family homes, I would say Bethlehem is the best place to invest in. If you're from the Lehigh valley, you know that Bethlehem is the place not only invest, but also to live in. There are many job opportunities in the area and great bars, restaurants and shopping centers. Bethlehem is also a huge college town as it has 2 of the best colleges in the Lehigh Valley.
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Rachel T.
OP
Rental Property Investor · PA · Member since 2019 · 6 posts · 3 votes
6y
@Jeffrey De Los Santos Thanks for the advice! What type of properties do you invest in Easton?
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Jeffrey De Los Santos
Rental Property Investor · Easton, PA · Member since 2019 · 38 posts · 9 votes
6y
@Rachel Toubin right now I invest in single family homes, but I'm working my way to multifamily.
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Jeff Amore
Investor · Bethlehem, PA · Member since 2015 · 84 posts · 34 votes
6y
Hi Rachel! The Lehigh Valley is a great place to invest in real estate. The Main Street area of Bethlehem is a fantastic area, but both Allentown and Easton have also had revitalization in their downtown areas. I would urge you to check out the requirements for owning rental property with each and every municipality you’re interested in so you don’t get any surprises. Also, there are areas of the Lehigh Valley outside of ABE proper that may be of interest, such as Nazareth, Northampton, Whitehall, or Hellertown. If there’s anything I can do to help, don’t hesitate to reach out. My contact info is in my profile. Good luck!
2 Reply
Alex Deacon
Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Rachel T. have you also considered the Pittsburgh Market? The prices and returns here are quite appealing.

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David Ribardo
Real Estate Agent · Allentown, PA · Member since 2016 · 197 posts · 181 votes
6y
@Rachel T. There are good areas and bad areas for investing across all three cities. Each has their own individual nuances that you need to be aware of before purchasing in them. For example, Easton is quite stringent on their Certificate of Occupancy inspections, and Bethlehem is absolutely a terrible place to buy if you want to do short-term AirBNB style rentals. The good thing is that all three cities have major economic drivers that are bringing growth to the area. By positioning yourself along the "path of progress", you can position yourself for above average appreciation and rental demand.
In general - center city Allentown has the best cash flow due to low purchase prices, low taxes, and relatively high rents. Bethlehem has some really high demand for Lehigh University student housing, and we've been having a ton of activity on the south side in that area. It's got moderate purchase prices, taxes, and rents. Easton has the highest taxes and expenses, but also has correspondingly higher rents. Overall, investors are buying at similar cap rates across all three communities. It just comes down to what is the best deal you can find, and which one is the best fit for you.
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Elliot Vann
Passaic, NJ · Member since 2017 · 65 posts · 42 votes
6y
@David Ribardo
Aren’t those colleges building brand new dorms? It will really mess with the supply and demand there...
What cap rates are you seeing those trade at?
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Tzvi AusubelPro Member
Rental Property Investor · New York City, NY · Member since 2015 · 244 posts · 66 votes
6y
@Rachel T. They all have pros and cons from investment standpoint. Most important is finding a property that will ACTUALLY cash flow based on your underwriting. As a newer investor, you should sample size the houses in your equity price range from each town and see how the deal analysis plays out for each location. PM me if you have any questions.
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Justin BrownBusiness Member
Real Estate Agent · Allentown, PA · Member since 2017 · 343 posts · 156 votes
6y
Like what everyone has to say. I would agree with @David Ribardo summation. If you don’t have a previous inclination you should just try to find a deal in any of the three. I would politely disagree with @Jeffrey De Los Santos as I think Allentown is the best place to live for the same reasons especially now that music and Celtic fest is canceled. Also if you want todo more than go to bars and restaurants there is more close by in Allentown :-) @Rachel T. are you looking to live here too?

[email protected]484-273-2414
Light House Realty LV4.971 Reviews
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Michael Deering
Rental Property Investor · Lehigh Valley, PA · Member since 2017 · 200 posts · 191 votes
6y
I own in Allentown, Easton, and Hellertown. Allentown provides higher velocity of tenants with its greater employment opportunities. The downside I see in Allentown is the best cash flow returns on paper may require dealing with poor tenants and that eats into those profits.
In Easton I get higher rents but the City of Easton is struct with it's landlords. I believe they require professional PMs if the owner lives greater than 20 miles from the rental. That said I am increasing my portfolio in Easton due to high demand from people looking to get out of NJ and NYC.
I think you can do well in ABE. If you're looking for an agent I do recommend Justin Brown. I'm new in the area and he's been a great help. Good luck!
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Justin BrownBusiness Member
Real Estate Agent · Allentown, PA · Member since 2017 · 343 posts · 156 votes
6y
By new in town @Michael Deering is being modest. Maybe the new king in town!
[email protected]484-273-2414
Light House Realty LV4.971 Reviews
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Randy Gutierrez
Investor · NY · Member since 2019 · 171 posts · 80 votes
6y
Out of the three Bethlehem makes the most sense from a $$$ pov. You get Easton rents and Allentown taxes. Inventory is not the best though.
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Rich Vogel
Rental Property Investor · Milltown, NJ · Member since 2014 · 131 posts · 130 votes
6y
@Rachel Toubin i have 51 units and most of them are in bethlehem.I do have a 9 unit in easton. I would look at deals in all three areas and see, what areas make sense for you. Like many people are saying allentown is good cash fnlow. I do get alot of people with kids come to bethlehem for rentals, cause they said they dont like the schools. Easton codes enforcement is tough. I just looked at a house that the inspector wouldnt count the attic as a bedroom cause it measured 6ft 11 inches and it has to be 7. If you need any help feel free to pm.
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Syed H.
Developer · NY/NJ/PA · Member since 2018 · 758 posts · 935 votes
6y
Allentown is great if you are self-managing and know what you are doing in terms of construction. But for hands off owners it’s tough IMO. These buildings are old and tenant base isn’t great.

Bethlehem is a solid area. I like it better than Easton. Easton town is a pain in the ***. Rents are not much higher than Bethlehem and Allentown for the price per unit.
You can make money buying in any of these cities. Just make sure you pay a reasonable number.
Too many people buy deals for high numbers because according to their excel sheet their making $XXX/month/unit. You can make whatever you want in an excel sheet. Reality is very different.
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Vince Nguyen
Member since 2022 · 24 posts · 16 votes
4y
Hi everyone I've been looking at Old Allentown because they have alot of nice historic buildings that I like. But I'm not familiar with that area as how tenants are. I hear that they have alot of HUD tenants which can be good or bad. On google maps the street looks good but not sure how they are in reality. Has anyone bought properties in Old Allentown and do you think it's a good location for out of town investor. Thanks in advance.
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Simon W.Business Member
Real Estate Consultant · Lehigh Valley PA & New York City · Member since 2013 · 1k+ posts · 687 votes
4y
Hi @Vince Nguyen

my company helps investors (around 85% are out of state investors that never even seen the properties) invest in the Lehigh Valley especially in Allentown. There are mixed market and HUD tenants.
Accounting Properties LLC
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CFO LLC
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Vince Nguyen
Member since 2022 · 24 posts · 16 votes
4y
@Simon W. Sorry for the late response. That's great to know thanks.
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