I'm an investor in the Philadelphia market. My goal is to acquire 4 properties over the next year. I have about $30k for downpayments and want to buy and hold. I lean towards MFH but I was recently told by an agent that MFHs are overpriced in Philly. Has this been anyone else's experience? Are singles a better deal here?
I'm still trying to find the right neighborhoods. Right now my list is (in no particular order):
Grays Ferry, Point Breeze, Bella Vista, Mantua, and Powelton Village. Lower income, developing areas where I can get better cash on cash ROI of my low down payments. Does anyone have experience in these areas or recommend better areas?
MFHs can be tough to get in Philadelphia, mainly because there is not a wealth of them available. Also, they can be very difficult to get into when they are tenant occupied. You have to be persistent in getting the tenants to agree to showing and hope they do not get sick last minute. Usually it takes at least 2-3 visits to see a whole property.
Point Breeze properties are really starting to move, and Grays Ferry is toted as having a lot of potential but until more businesses move into the area I do not expect a lot of appreciation. Mantua/Powelton Village can get very pricey as you get close to the universities which is where you would want to be.
With 30k of capital, you would like be looking at the down payment for 1 duplex/triplex in the city. I live and work in the city so if you ever have questions, feel free to reach out.
Best of luck!
I hear so much about Point Breeze that it makes me hesitant. Do you think that its still early enough in the gentrification process to find deals?
Hello @Gabriel Tursi , this is the first time I have ever heard that MFHs are overpriced in Philly. I wonder if that comment is for the City Center and surrounding neighborhoods, in which every thing real estate related in my opinion is overpriced. Outside of the hot neighborhoods I believe MFH are fairly balanced depending on number of units. I bought a duplex in March of this year for less than 100k with tenants in place. The home for sale next to mine sold for 30k more than I paid for mine. But, my purchase was in the Lawndale section of the city. Deals are out there is you are willing to reach out beyond City Center.
Single Family homes are big with Section 8ers. Also, depending on the area you can get great deals between 50-80K. I would suggest keeping in open mind and not rule out any thing including condos if you want to stay in the Center City area.
Plenty of deals can still be found in Point Breeze. There is a lot of development going on but it is spotty, and block to block. You will see many blocks that have a few brand new mansions, a few rehabbed smaller homes, a few run down homes, a few shells, and a few vacant lots. Par for the course.
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@Gabriel Tursi - as you may already know (and is the common verb-age for investors) in Philly, neighborhoods vary literally block by block.
I have many friends who have either bought or are renting in Point Breeze. I like the area with its close proximity to Grad Hospital and Washington Ave has many big time development in the pipeline. Rittenhouse is only 1 mile away.
Not many rehab/low cost homes on the MLS right now - townhouses starting at $150k and up - almost no MFH in the market either.
Other areas you might want to consider if you are willing to do (or pay) for a rehab is Brewerytown and East Falls.
@Gabriel Tursi How'd your search go?
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