Rental Property Investor · Queens, NY · Member since 2020 · 7 posts · 2 votes
I’m looking to get started buying rental properties in Pennsylvania while I live in New York. I need advise on landlord laws and where a good place to invest would be.
Thanks in advance for all the info you wish to share with me.
In Pennsylvania, most "landlord" laws are the same with the exception of Philadelphia and Pittsburgh/Alleghany County. Due to their special status, they tend to have a different set of rules than rest of the state. Nothing too crazy but something to keep in mind.
In terms of where to invest, it depends on your goals and location. Lots of folks from NY invest in Philadelphia, Allentown/Lehigh Valley, Wilkes-Barre/Scranton, and Poconos area due to the driving distance. All different markets with their own pros and cons.
Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.
In Pennsylvania, most "landlord" laws are the same with the exception of Philadelphia and Pittsburgh/Alleghany County. Due to their special status, they tend to have a different set of rules than rest of the state. Nothing too crazy but something to keep in mind.
In terms of where to invest, it depends on your goals and location. Lots of folks from NY invest in Philadelphia, Allentown/Lehigh Valley, Wilkes-Barre/Scranton, and Poconos area due to the driving distance. All different markets with their own pros and cons.
Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.
Rental Property Investor · Queens, NY · Member since 2020 · 7 posts · 2 votes
6y
@Chris K. Thanks for the info. I don’t care too much about the drive I will have property management company to take care of it but locations are something I’m tryin to learn about. I have been to Pocono and I know that’s great but any other info would be much appreciated.
Investor · Philadelphia · Member since 2020 · 112 posts · 150 votes
6y
@Brett Weisman I can give you some perspective on the Philadelphia area. You may want to stay away from the nicest parts of the city if you're doing rentals. I'm seeing great SFH rental opportunities in West Philly, Darby, and Upper Darby. You can easily exceed the 1% rule in these areas.
Recently, I've been seeing a lot of multi-family properties up for grabs at great prices in Parkside, Darby, Upper Darby, Collingdale, Aldan, Marcus Hook, and Norristown. I recommend familiarizing yourself with these areas.
When it comes to markets in Pennsylvania, you have the following breakdown:
Philadelphia/Pittsburgh: the two primary markets in Pennsylvania. There's a wide range of cap rates, but the market cap rate has been around 6% to 7% range.
Allentown/Lehigh Valley: I would call this area the secondary market. Market cap rate of around 8% to 9%.
Tertiary Markets: this includes Harrisburg, Scranton/Wilkes-Barre, Lancaster, York/Hanover, and Reading. All these areas have historically had a market cap rate of around 10%.
Everything else: this includes college towns like State College and smaller areas like Stroudsburg.
As a general rule, higher cap rate areas will "cash flow" better than lower cap areas. That make intuitive sense. But that doesn't mean higher cap rate areas are better investments. It just depends on your goals.
Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.
There's really no "best" area. They all have different opportunities and require different strategies.
I do some consulting work with different real estate investors. Once in a while, I get clients that want me to be their "tutor" of sorts for multifamily investing. One of my favorite test I like to give is for the investor to explain how they would make money in a tertiary market like Wilkes-Barre/Scranton versus say a primary market like NYC. If the person cannot come up with a cohesive answer, it tells me that the person still has a lot to learn.
Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.
Rental Property Investor · North Wales, PA · Member since 2018 · 3 posts · 3 votes
6y
@Brett Weisman Based on my experience of investing in Scranton PA, property cash flow is GREAT.
Do your due diligence on property taxes. In Scranton, you will see properties in certain area/zip code with relatively high property taxes compared to almost similar property in another area/zip code.
Make sure to screen property management company and have the terms of management clearly specified. Once of the company I hired started taking rent in the form of checks mailed to their office. They didn't even care to go to the property on regular time for inspection/damages/repairs/or even grass cut.
If you plan to invest in multifamily properties make sure the utilities are separate especially water. The per gallon water cost is crazy high in Scranton, PA compared to other areas.
Rental Property Investor · Queens, NY · Member since 2020 · 7 posts · 2 votes
6y
@Ruchit V. Patel can you recommend a good property management company. I will need this since I live in new york. Are there any other areas that I should take a closer look at that’s would be great for cash flow?
Rental Property Investor · New City, NY · Member since 2014 · 11 posts · 2 votes
6y
Hi everyone, I'm also an investor from NY and I'm tying to get an understanding of the taxes/fees/insurance in the Wilkes-Barre area. I'd appreciate your help with the following questions:
1) Are city, county, and school the three taxes that are paid on properties? Are they billed together or separate?
2) My understanding is that there are also levee, sewer, sanitary, and storm-water fees. Any idea how much these fees are on average for a double/side-by-side house?
3) How much does flood insurance run for in that area(ballpark number)?
4) How much do property management companies charge in the Wilkes-Barre area? My understanding is that the city requires PMs for houses owned by non-local investors.
Investor · Luzerne County, PA · Member since 2015 · 18 posts · 3 votes
6y
Alex you’ve done some good research
1. Billed separately
2 levee fee $96 a year .
Sewer $55 a quarter per unit, + store water fee which varies—-I add $15 a unit per quarter to be safe( that’s usually overkill) + about another $100 flat fee for the year for Wilkes Barre on top of that.
3. Flood insurance varies on property. When you find a property I'd suggest check out FEMA website to see if it's in the zone. Also check w insurance agent
4. 10% I find is average for PM. Yes the city does say that not sure if it’s enforced .
message me with any other questions I’m happy to help. I also will have some nice 2 units coming up. Let me know your criteria