Bronx, NY · Member since 2020 · 94 posts · 27 votes
I'm new to investing and researching the best markets to look for my first deal. Someone suggested the Pennsylvania area, specifically Harrisburg. Wanted to get some feedback from the community. Thanks.
Rental Property Investor · Hummelstown, PA · Member since 2015 · 638 posts · 653 votes
6y
@Steven Jefferson
The other responses did a great job. I’ll add/reiterate the following:
We’ve got great population and job growth, and it’s STABLE. The jobs come from a diverse spectrum of industries. That equates to less risk, the job market is strong therefore your tenants will (should) be able to find employment and keep paying you rent.
Low cost of living and that includes housing. It’s a double edged sword because that means most people with a decent credit score can afford to buy a place. Then (most of) the only people left renting are very financially unstable. You gotta be strict when screening tenants and wait for the good ones.
I live on the East Shore (Dauphin County) but I’m in love with the West Shore (Cumberland County) for investing. Lower taxes, better schools, better tenants, and better employment opportunities and even better/more shopping/restaurants.
You will notice that us locals have a weird tendency to speak in terms of East Shore vs. West Shore. We are referring to which side of the Susquehanna River. Most of us will admit that it’s weird, but there is a difference between the two, partially real and partially perceived. Either way you’ll want to learn about those differences.
We have a lot of really old houses. 100+ years old. If you buy one you’re signing up for all kinda of extra funky issues. I buy them all the time, but I’ve gotten used to it. The rehab can really bite you in the butt if you aren’t really conservative in estimating. Expect to replace everything, unless you’re buying it turnkey. If it’s “turnkey” you should expect it to have all new electrical, plumbing, roof, windows, and HVAC.
Our appreciation is very slow moving. If anyone tells you “this area is up and coming” in Central PA that doesn’t mean it will be gentrified and worth 100% more in 1-2 years. That means 5-10 years here.
Overall, we generally keep pace with inflation, possibly a little less. Our home prices stay low, which plays into the affordability that I mentioned above.
Rental Property Investor · Allentown PA, United States · Member since 2016 · 567 posts · 442 votes
6y
@Steven Jefferson Harrisburg is a great market. Obviously has it’s rough parts but I think wherever there is government will have a stable local economy for years to come
Rental Property Investor · Mechanicsburg, PA · Member since 2018 · 281 posts · 176 votes
6y
@Steven Jefferson couple other areas to consider. Harrisburg and Hershey areas (Dauphin County), West shore of Susquehanna River includes Camp Hill, Mechanicsburg & county seat Carlisle (Cumberland County). Also Lancaster & surrounding areas (Lancaster County). All these areas are within 1 hour of each other for the most part.
Realtor · Harrisburg, PA · Member since 2017 · 43 posts · 43 votes
6y
The greater Harrisburg area is a great place to invest in rentals. Buy and Hold in most areas (for cash flow) and BRRRR any select areas are good strategies. Fix and flips are best kept to the outer burbs. Values generally rise slowly in the greater region but are generally on an upswing. Feel free to contact me for more details. I do BRRRR in the area
Property Manager · 17112 · Member since 2016 · 271 posts · 151 votes
6y
I'll second what @Beck Joyner said. Harrisburg can have some great cash flowing areas, but I would caution you that it's very block by block. That can be said about many cities but Harrisburg especially. There are parts, where one street separates you from 200k+ houses and on the other side are 40k war zone/drug infested areas. Make sure you have some boots on the ground or get a second opinion if you're not sure. If you stick to other parts of Dauphin county or the 'West Shore' area that others have mentioned. Also, regarding the 'West Shore', Cumberland county has been one of the fastest growing counties in the state for the past decade. You may want to look into Carlisle, and I also like Middletown (Dauphin county). There's a lot of stable employment in the area such as several multi-billion dollar companies that have a presence in the area (Hershey, TE Connectivity, Phoenix Contact, Rite Aide, ) as well as many Federal jobs on top of all the state jobs that @Bill Goodland mentioned. If you drive down I-81 through Cumberland county you will also see many 1mm sq ft warehouses that also provides employment. Feel free to reach out if you have any questions.
Rental Property Investor · Hummelstown, PA · Member since 2015 · 638 posts · 653 votes
6y
@Steven Jefferson
The other responses did a great job. I’ll add/reiterate the following:
We’ve got great population and job growth, and it’s STABLE. The jobs come from a diverse spectrum of industries. That equates to less risk, the job market is strong therefore your tenants will (should) be able to find employment and keep paying you rent.
Low cost of living and that includes housing. It’s a double edged sword because that means most people with a decent credit score can afford to buy a place. Then (most of) the only people left renting are very financially unstable. You gotta be strict when screening tenants and wait for the good ones.
I live on the East Shore (Dauphin County) but I’m in love with the West Shore (Cumberland County) for investing. Lower taxes, better schools, better tenants, and better employment opportunities and even better/more shopping/restaurants.
You will notice that us locals have a weird tendency to speak in terms of East Shore vs. West Shore. We are referring to which side of the Susquehanna River. Most of us will admit that it’s weird, but there is a difference between the two, partially real and partially perceived. Either way you’ll want to learn about those differences.
We have a lot of really old houses. 100+ years old. If you buy one you’re signing up for all kinda of extra funky issues. I buy them all the time, but I’ve gotten used to it. The rehab can really bite you in the butt if you aren’t really conservative in estimating. Expect to replace everything, unless you’re buying it turnkey. If it’s “turnkey” you should expect it to have all new electrical, plumbing, roof, windows, and HVAC.
Our appreciation is very slow moving. If anyone tells you “this area is up and coming” in Central PA that doesn’t mean it will be gentrified and worth 100% more in 1-2 years. That means 5-10 years here.
Overall, we generally keep pace with inflation, possibly a little less. Our home prices stay low, which plays into the affordability that I mentioned above.
Realtor · Harrisburg, PA · Member since 2017 · 43 posts · 43 votes
6y
"Then (most of) the only people left renting are very financially unstable" This is so true, Kyle! I have marketed a couple of rentals for my sister company and it was really an eye opener to see how many applicants have bad credit and can't qualify (unless they can put down 2x the deposit - and most CAN'T).
Rental Property Investor · Hummelstown, PA · Member since 2015 · 638 posts · 653 votes
6y
@Becky Joyner
Exactly. Who, in good financial standing, will rent a place for $1000 or $1200 when they could buy the same place with an FHA loan, for only a few thousand out of pocket, with an interest rate of 3%, and the mortgage might be only $700?
The only demographic that has a better chance of being more qualified are the young 20-somethings, maybe they are single or recently married, and not ready to buy yet. But they’ll only stay for a year or two.
Bronx, NY · Member since 2020 · 94 posts · 27 votes
6y
Justin, Becky, travis, austin, kyle. Appreciate all the advice and input. Gave me a lot to consider. kyle you mentioned turnkey. What is your opinion on that. Would you recommend it being that there's a lot of very old homes out there. Others please feel free to offer your opinions. Thanks
Rental Property Investor · Chelmsford, MA · Member since 2017 · 7 posts · 0 votes
4y
Hi Steven - any update in the past year?
With family close by, I'm often in the area, and I'm rethinking investing in this area. After hearing from Kyle and Becky, I can't really argue their point. Having said that, I know it's trying to be revitalized and some big building projects are in the works.
Kyle and Becky, I wonder if your perspective is still the same. I know the Carlisle Pike has been growing like crazy, and I'm sure there are similar situations on the East Shore.
Bronx, NY · Member since 2020 · 94 posts · 27 votes
4y
@Alexander M. Update: We purchased 2 single family houses and 1 three unit house. With the help of our realtor (Beck Joyner) I think we got pretty good deals. The hardest part is finding reliable contractors. The homes in the Harrisburg area where we purchased are old, some close to 100 years so you can imagine the reno it needs. But all in all it has been a learning experience. Honestly It gets frustrating sometimes ,but once you done with reno and place a tenant you get that desire to look for the next deal.