Pittsburgh vs Raleigh - First Home as an investment property

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Pittsburgh vs Raleigh - First Home as an investment property

Vikas Deshpande
Member since 2021 · 1 post · 0 votes

Hello everyone, 

My name is Vikas and I recently joined and have learnt a lot from the forums I have visited, thank you so much. I was looking for some advice/opinions, I live in California and have realized buying a house here is not affordable for me, so was looking for other states to buy my first investment property. I want to move to east coast in around 3 years and considering Raleigh (RTP area - Cary, Morrisville, Apex), North Carolina as an option as I have studied there and like it, and Pittsburgh, PA. 

I want to buy a property from an investment perspective, I was wondering which out of these two cities would be preferable in terms of ease of renting (rent per month and the time it takes to rent it out). I am open to learn about other cities as well. What I am looking for from this investment property is that the rent covers mortgage and may be I have a positive cash flow. 

Feel free to ask any questions, this is my first post here and I apologize in case of any mistakes. 

Thank you and I look forward to hearing more about your opinions.

Regards,

Vikas

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Rohan D.
Member since 2019 · 41 posts · 41 votes
5y

Hi Vikas, I do not know about either of the cities. But stick to the basics when it comes to trying to select your market. Population growth, job growth, income growth and a landlord friendly state (I think RTP wins here). Make sure you check with your realtor to share lease (rental) comps, that will give you a good idea about rental demand (cost and days on market). Afaik, rtp will not cashflow unless you increase your equity in the deal.

Lastly, cannot stress enough on having a good team on the ground, one you can trust.  The point here is, talk to PMs in both cities and get a feel of rents, management expenses, management styles etc. They will give you an idea of preferable neighborhoods, preferable house layouts for renters etc...

Since you are going to be a oos investor, just curious why restrict yourself to these 2 cities? It's understandable if its because of your familiarity to the city in the past. But you maybe giving up greater cashflow/growth potential by leaving the rest of many wonderful cities out.

hope I did not confuse you further :)

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  • Taylor L.
    Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
    5y

    Short version: I prefer the southeast to northeast. 

    Long version: I am originally from PA and the state government has always been a complete mess. PA has huge unfunded pension liabilities, and they're going to get that money from somewhere eventually (property owners?). PA is not a particularly bad state, but as far as growth prospects go I have much higher expectations for RTP, Charlotte, and other parts of the Carolinas.

    You could get a feel for ease of renting by looking at vacancy rates and by observing how long rentals stay on the market. Most major metros have huge housing shortages, so my hypothesis would be that both areas will be roughly equivalent, with RTP maybe having a slight edge.

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  • Rohan D.
    Member since 2019 · 41 posts · 41 votes
    5y

    Hi Vikas, I do not know about either of the cities. But stick to the basics when it comes to trying to select your market. Population growth, job growth, income growth and a landlord friendly state (I think RTP wins here). Make sure you check with your realtor to share lease (rental) comps, that will give you a good idea about rental demand (cost and days on market). Afaik, rtp will not cashflow unless you increase your equity in the deal.

    Lastly, cannot stress enough on having a good team on the ground, one you can trust.  The point here is, talk to PMs in both cities and get a feel of rents, management expenses, management styles etc. They will give you an idea of preferable neighborhoods, preferable house layouts for renters etc...

    Since you are going to be a oos investor, just curious why restrict yourself to these 2 cities? It's understandable if its because of your familiarity to the city in the past. But you maybe giving up greater cashflow/growth potential by leaving the rest of many wonderful cities out.

    hope I did not confuse you further :)

    1Reply
  • H. Louretta Dawkins
    Property Manager · North Carolina & South Carolina · Member since 2021 · 44 posts · 18 votes
    5y

    Hello Vikas,

    I would be happy to discuss rental properties in North Carolina.  Let me know when you have time for a chat.

    0Reply
  • Jesse Rivera
    Lender · Long Beach, CA · Member since 2013 · 496 posts · 296 votes
    5y
    Originally posted by @Rohan D.:

    Hi Vikas, I do not know about either of the cities. But stick to the basics when it comes to trying to select your market. Population growth, job growth, income growth and a landlord friendly state (I think RTP wins here). Make sure you check with your realtor to share lease (rental) comps, that will give you a good idea about rental demand (cost and days on market). Afaik, rtp will not cashflow unless you increase your equity in the deal.

    Lastly, cannot stress enough on having a good team on the ground, one you can trust.  The point here is, talk to PMs in both cities and get a feel of rents, management expenses, management styles etc. They will give you an idea of preferable neighborhoods, preferable house layouts for renters etc...

    Since you are going to be a oos investor, just curious why restrict yourself to these 2 cities? It's understandable if its because of your familiarity to the city in the past. But you maybe giving up greater cashflow/growth potential by leaving the rest of many wonderful cities out.

    hope I did not confuse you further :)

    Great advice from Rohan. My biggest lesson is having someone there that you can trust, and is invested in your success. It will take a while to find the right person. I ended making my contractor a partner, so not only does he get paid as a contractor, he get a part of the profits. Was working fine before Covid, and we will start up again early next year.

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