Where to invest in philadelphia for 1st time investor

6 Replies

Hi, I am new to the site and trying to buy a second property as an investment in Philadelphia. Right now I am a live in landlord at my first place house hacking. I have been primarily looking at SFH in 180-220k range. I have lived here for 7 years so I am pretty familiar with all the areas but am having trouble picking a neighborhood. I really like Point Breeze for the appreciation but I believe there might be a bubble and have to compete for renters. My other option is Manyunk/East Falls area, where I currently live. I have found the appreciation to be lower but the rental market has been great so I like the stability. My goal is to hold and have passive cash flow. Any advice is extremely appreciated!

Hey Dave, my advice- don't limit yourself to a specific neighborhood. Philly has a ton of great areas that are perfect for buy and hold investors and if you only look in one of those areas, you are seriously hurting your chances of finding a good deal. When I look for deals for my investors, I am more focused on numbers than neighborhoods. While location plays a huge role in determining if numbers work out for any deal, I like to keep an open mind. Point Breeze is great, Brewerytown is great, and many other hot markets would fit your business model well. I would love to talk with you more about the buy and hold properties I've been moving. Shoot me a message if you'd like to continue this conversation!

@Dave Ventura , I always recommend to invest for cash flow not appreciation but try to invest in the path of progress to increase your chances of an appreciation bonus. I think that Point Breeze, Grey's Ferry and West Passyunk are great places to invest in Philadelphia that are in the path of progress. I live in and invest in Point Breeze and I'm active in the investing community. Feel free to reach out with any questions and let me know if there is anything I might be able to help you with!

Hi Garrett, 

Thanks for the advice, I really appreciate it.  Are you concerned about point breeze becoming a bubble soon, I feel like renters are going to have the upper hand in negotiations if there is too much supply. 

Hi @Dave Ventura , I personally do not think so for rentals. I think that the population growth of the city means that there are more renters looking for a place to live near center city every single day (quicker than houses are being built/ rehabbed and put up for rent). Some of the reasons for this population growth if from people living in New York city attracted by the more reasonable housing costs while still being able to commute if needed and the high college graduate retention rate. Philadelphia universities have an above average retention rate of graduates staying in the area. Plenty of med students that stick around or graduates in other industries might find post grad jobs in places like King of Prussia but still want to live in the city so we commute (myself included- work in KOP and live in Point Breeze). Point Breeze is one of the areas that these renters are moving to for it's relative affordability when compared to places in center city yet still within walking distance of center city. The attraction to point breeze is only going to improve in my opinion with OCF Realty's plans to build 40+ townhouses, 20+ apartments, retail store frontage and Dock st brewery setting up camp on Washington ave on the border of  Graduate Hospital and Point breeze. 

I think that you could see the home price bubble burst if/ when the 10 year tax abatement goes away or is lessened in value. Currently home buyers are able to qualify for an over inflated amount due to not having to pay their full tax bill for the first 10 years on a new or fully rehabbed property. This drives home values up but if it were to go away I believe home values would quickly drop by a significant amount.

I hope this helps! 

Originally posted by @Alexander Brian Frederick :

Hey Dave, my advice- don't limit yourself to a specific neighborhood. Philly has a ton of great areas that are perfect for buy and hold investors and if you only look in one of those areas, you are seriously hurting your chances of finding a good deal. When I look for deals for my investors, I am more focused on numbers than neighborhoods. While location plays a huge role in determining if numbers work out for any deal, I like to keep an open mind. Point Breeze is great, Brewerytown is great, and many other hot markets would fit your business model well. I would love to talk with you more about the buy and hold properties I've been moving. Shoot me a message if you'd like to continue this conversation!

 How exactly are you looking for deals?

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