Passyunk Philly - Too Late?

Question

Hi Everyone,

First post to the forums but I've been a long time follower of the podcast and Bigger Pockets in general. I am looking to move to Philly and I would really like to live in a good area with plenty of bars and restaurants. Passyunk square area caught my eye because of what the area has to offer along with the relative affordability. I am looking for something that's a fixer upper but not a gut rehab. My family owns a construction company so we can do the work in house. I plan to live there for about 2-3 years then move to NJ, and I will then rent out the property.

My question is, am I too late to come into this area? It seems Passyunk is just about "there" but I'd like the opinion from some locals on what I'm looking to do. I am hoping the area is still appreciating well.

Off topic question, but the property I am looking at seems perfect for what I'm looking for, but the ceiling height on the 2nd floor is only about 7'. It won't bother me, but should I be concerned for renting, and for resale?

Thank you in advance for any input, and I apologize if I've put this in the wrong thread!

Melanie King · Answer

Hi @Nick Russo,

I sold my live-in-flip in West Passyunk, Philadelphia (20th and Snyder) in May of this year. I bought the 3 BR, 1 BA, 1-car garage, 1300 sq ft. rowhome in November 2015 for $140k, put about $90k into renovations (all new electrical, HVAC, kitchen, bathroom, everything) over the 3+ period I owned the property. It sold for $290k to an investor who is now renting it out. I was very happy with the outcome of the sale! West Passyunk is still a very viable market, but don't wait too long.

Benefits of West Passyunk:

1. Close to the 1st District Police & Fire Stations

2. Strong neighborhood association (WPNA)

3. Local restaurants and bars - my favorites are Cafe y Chocolate and ARS Brewery

4. Easy access to I-76

5. Very low real estate taxes

Downfalls:

1. Parking, but that is anywhere in Philly

2. Walking distance to subway

3. Some section 8 housing near the neighborhood

Feel free to reach out if you have more questions!

Jimmy O'Connor · Answer

@Nick Russo South Philly has a large amount of inventory active right now. Inventory is still moving down there, you just have to stand out by putting more into the properties to get the prices from last year or quick days on market. East Passyunk is one of the more mature neighborhoods in South Philly and has the commercial in Passyunk ave to support sustained growth. A mile or so westwards in Point Breeze is seeing a little more of a stall since the commercial isn't fully there yet. Ori Feibush (Owner of OCF Realty and King of Point Breeze) is fixing that with what he has going on with the demoed chocolate factory turning into a huge mixed-used facility off of 22th and Washington.

Around what price point do you want to hover around?

Nick Russo · Answer

Thanks Jimmy and Melanie. I ended up going with a home in east passyunk area, my offer was just accepted. The price is 247k and I was considering putting a 3rd story on, giving it 3 good size bedrooms (master suite on the third floor) and 2.5 baths. I am seeing homes like this sell for 480k plus. I'm working through the numbers to make sure the investment is worth the resale.

Once I'm living in the area, I'd love to consider my next investment in West Passyunk as it seems that is very up and coming, so I'll continue to do some research in that area. Thank you both for the insight! That is very interesting to hear about Point Breeze as well. I had thought the same thing, that it needed some commercial growth in order for the area to really grow.

Nick Russo · Answer

Thanks Timm, that's exactly what i'm hoping for. I am looking in this area specifically since i'll be living there, and i'm just hoping that the area is stable and will hopefully only increase. Once i am there, i definitely plan to continue to invest in Philly. I tried to take a look at that link but it won't seem to load. I'll keep trying. Thanks again for the response.

Timm DeSalis · Answer

@Nick Russo passyunk is definitely well established at this point but I dont see the market dipping back down. It will only keep growing. Here is whats going on a little west on Passyunk. Worth a look for future investments.

http://www.ocfrealty.com/naked...

Passyunk Philly - Too Late?

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