My name is Brian, I am new to the forum. Looking for info on investing in a multi family property to house hack in Philadelphia. Goal is to be able to have the tenants cover all expenses and live in one of the units. What are some good neighborhoods to look into that are safe? I have noticed on realtor.com that decent properties are around 300k. Looking for a more turn key or light repairs. Any info is appreciated. Thank you in advance.
Welcome @Brian Silverman ! I'm a fellow Philadelphia House hacker! I live in Point Breeze so I'm partial to this area. It's developing like crazy and you can get relatively high rents to match the relatively high Philadelphia home prices. Neighborhoods like Point Breeze, Fishtown, Brewerytown are frequently mentioned as areas to invest. They are hot markets but it's where people want to be which is where you want to own rental properties in my opinion (or at least near those areas depending on your budget). I love helping people start their investing journey and the first step is often a house hack so you are in the right mindset! Plus, there are tons of loan programs available to beginners/ first time home buyers/ owner occupants. They have low barrier to entry with low credit requirements and low down payment minimums. Feel free to reach out and I'd be happy to help in any way that I can!
I will send you a PM, Thanks!
@Brian Silverman - If your criteria is to find a multifamily property that
1) Allows you to occupy the property and have a tenants cover all expenses
2) Is in a safe neighborhood in Philadelphia
3) Has a purchase price of around $300K
4) is a turn key or just in need of light repairs
(I am also going to assume that you will use an FHA loan, and will put 3.5% down. I think your best shot to pull off all the)
One possible way to at least come close to pulling that off would be to find a property like this:
This property is in a safe area, has a listed price of around $300,000, and looks like it is in good condition. If you got a place like this for around $300,000, your fixed monthly costs would be your mortgage payment (~$2,000) and Water/Garbage (~$100) for a total of $2,100. You could manage the property yourself to eliminate property management costs.
You could live in the one of the bedrooms of the 3 bedroom unit and rent out the other 2 bedrooms to friends or people you found on Craigslist for $600 a room. Those tenants could also help by splitting the other utilities of the 3 bedroom (gas/cable/internet). Then you could rent out the 1-bedroom for $900. That brings your total income to $2,100, covering all of your fixed costs.
This does not account for variable expenses (repairs, capital expenditures, vacancy) which can quickly cut into your income if you cannot keep the property rented (vacancy) or increase your expenses if the property ends up needing repairs.
Good luck with your investing!
Thank you for your response Richard. I will keep all of that in mind. My goal is to have one of the units completely to myself.