Philadelphia, PA · Member since 2016 · 12 posts · 4 votes
Hi folks! I'm a new investor looking at buying a duplex or single family in NW Philadelphia. Right now I've been concentrating most of my energy on Germantown. Does anyone have experience investing in this area?
I live in Mt Airy but am not hugely familiar with all the nuances of Germantown. It seems similar to Mt Airy in that it can vary so much block by block, etc, and I'm trying to get a handle on what areas / blocks of Germantown are stronger investments. I'm looking to buy and hold, so will be wanting a strong rental market with lots of potential for solid tenants. Does proximity to Germantown Ave matter? Proximity to the train? Parking? Number of bedrooms? Etc. Generally west Germantown is looking more attractive, but even within that there is huge variation. I'm keen on a duplex near Johnson and Germantown Ave but am not very familiar with that pocket. It's one of the best houses on the block, which concerns me a little.
I believe that Germantown presents a great investment opportunity, I love the community and I feel that it's making some great strides, I just want to make sure I'm focusing on the right areas.
Banker · Philadelphia · Member since 2009 · 2k+ posts · 632 votes
10y
Hi @Kathryn Krueger,
How are you and welcome to BP!
There are some specific pockets on the rise in Germantown and neighboring neighborhoods. Would suggest attending ZBA meetings and Neighborhood Association meetings in the area and become a study of the areas to determine your moves, etc.
Engineer · Philadelphia, PA · Member since 2012 · 75 posts · 14 votes
10y
Welcome to BP Kathryn,
Germantown is very diverse as you mentioned. I would say east of Germantown Ave will have generally smaller houses, that are less expensive and therefore will have lower rents and purchase prices than west of Germantown Ave. There are definitely gems on both sides you will be able to find something profitable with some investigation. Good luck!
Real Estate Agent · Philadelphia, PA · Member since 2015 · 51 posts · 9 votes
10y
If you'd ever like to come by my office, we can look at the area together and run some numbers through the BP calculators to weigh the pros and cons of deals in that area on paper. I haven't checked out Germantown yet, but have been meaning to see what is out there. Message me if you are interested.
Real Estate Investor · Philadelphia, PA · Member since 2016 · 45 posts · 16 votes
10y
@Kathryn Krueger, I'm also looking to make my first purchase in the area. I am considering several options in and around Philly. I looked at Germantown and this area seems to have some of the better cap rates in the city. However, my goal is to house hack and I don't want to reside in Germantown so I crossed it off my list. I think I located the duplex you are referring to. The numbers look good if you use the rent amounts listed. I would be concerned that the rents are inflated, they seem to be a little high for the area. (if were talking about the same place). Also, you say you are looking for solid tenants, but will you get the best tenants in Germantown? Not trying to talk you out of it, just playing devils advocate. Best of luck.
Philadelphia, PA · Member since 2016 · 12 posts · 4 votes
10y
Thanks all for this advice, much appreciated.
@Joe S., thanks for the input. The duplex is actually a set of neighboring rowhouses on Duval, is that the property you looked at? The numbers do look good. I met one of the owners and both tenants last night. The rents are perhaps a bit higher than they should be, but I just looked at all the recent rentals in the area and they're kind of all over the map. I'm keeping the rental numbers a bit low to be conservative when looking at the returns.
There's definitely some question about tenants in Germantown, but I think in general I'll be able to find decent tenants in that area. But yes, that is a concern, although a very small one for me I think.
This property seems low risk, in that they will be low maintenance for a while since they've both been so recently and completely renovated, and they're both rented. In general, I'm keen on Germantown, there's a definite push right now to improve housing in the area, and I think it's just getting more and more attractive to folks who are liking all the great things about NW philly but are getting priced out of Mt Airy. I know several people who live in Germantown for that reason. I think in terms of buy and hold, it's a positive situation.
Good luck in your search. I'm personally looking to close on something soon, so fingers crossed. Trying to remind myself that whatever I buy doesn't have to be the BEST opportunity in the city, just a GREAT one. At some point I have to pull the trigger and just move forward. I have capital to continue buying. But the first purchase is a definitely a little scary!
Investor · Philadelphia, PA · Member since 2015 · 69 posts · 28 votes
10y
I like Germantown, most of my portfolio is in and around Germantown. Good Cap rates and you can find some nice homes with character. My strategy at this point is renting to tenants with housing vouchers, I get peice of mind knowing that the rent will be paid pretty regularly. If I was renting to traditional private pay tenants Germantown might not be my area of focus. I think much of Germantown may be considered a "C" rated area ( there are definitely some B- C+ blocks but then you also have C- maybe even approaching D+ blocks). I think when you get in to the better parts of Germantown your cap rates start to go down and you may be able to find properties where you get more value for similar cap rates in other areas. For renting to section 8 tenants, it's an ideal area for me. By the way I am selective as possible with tenant screening and try to provide a good quality product for my tenants. Sometimes section 8 gets a bad rap but I think it's a good program to help hard working families that are struggling to get back on their feet. In addition to housing payment assistance they offer many other non monetary resources to help families succeed.
Philly Area, PA · Member since 2008 · 297 posts · 27 votes
10y
I know Germantown in general, not 100% on neighborhoods though. But with that said look for proximity to public transportation, hospitals, schools, etc. Good luck roc
Philadelphia, PA · Member since 2016 · 12 posts · 4 votes
9y
Hi Donna! I actually did NOT end up purchasing the Germantown homes, the owner was being too greedy. I believe they're actually still on the market :)
Early Sept I bought a 2 bed condo in Rox and a rowhouse in E Mt Airy. I just finished the work on the Mt Airy house and put it on the market earlier this week. The response has been really strong, so I am relieved. I was a little unsure I had hit the right price on the rent, and I wasn't sure there would be strong demand at this time of year. Fingers crossed I'll have that one rented soon. The condo in Rox will be ready in the next few days and I think that one should get snapped up pretty quickly.
What a learning experience this has been!! From dealing with all the contractors to all the ins and outs of getting a house ready to market and then finding tenants. Overall it's gone pretty smoothly. But it's taken lots of time and energy. So be prepared for that! I'm finding it very rewarding. I'm ready for some checks to start coming IN. I feel like all I ever do these days is write checks :)
Investor · Philadelphia PA · Member since 2016 · 44 posts · 10 votes
9y
Kathryn Krueger great post, awesome conversation and I agree with most, Germantown has its good pockets. I can tell you it is on the way back with Comcast investing money in the boys and girls club which will be named after Ralph Roberts the late company founder. And Vernon park at about Germantown Ave and Chelton Ave is also being targeted by the city to under go some additional sprucing up. This is a really historical area so getting a rental now on the right block could be a really smart move 5 to 10 years from now. If you are thinking of house hacking you want to get as close to Lincoln dr or Wissahican Ave which is walking distance from Philly U. Campus.
Best of luck!
Philadelphia, PA · Member since 2016 · 12 posts · 4 votes
9y
Great input @Angelo Goodwin. I'm super excited about Germantown in general. I missed out on a couple of good properties there over the summer and I'm bummed. I'm looking at Germantown for my next purchase. I really feel like the area has alot going for it. But it is definitely kind of block by block, although you can absolutely say the same about E Mt Airy, which people tend to consider 'better'.
Investor · Philadelphia PA · Member since 2016 · 44 posts · 10 votes
9y
Kathryn Krueger I actually did a few years back, that I sold but it was closer to Chew Ave and Chelten Ave. Mt Airy is a lot more desirable for flips. But there are some strong rental areas. If you want some help with finding the right blocks in Gtown or Mt Airy area I would be happy to help you. Shoot me a message or text my info is in my profile.
Contractor · Seattle, WA · Member since 2014 · 137 posts · 44 votes
9y
I own four houses in Germantown/Mt. Airy and I think Germantown is one of Philly's best kept secrets. Parts of it have that classic colonial feel, especially when you get close to Mt. Airy. Close to Germantown Ave it's also walkable and lots of little businesses, coffee shops, etc. Also bigger houses that in some cases are relatively cheap. I think this area has a lot of upside going forward.
Philadelphia, PA · Member since 2015 · 14 posts · 9 votes
9y
Hey everyone - I kind of wish I could get you all in a room to talk about investing in the Germantown area. I really love Germantown - my dad grew up there, and I like the community spirit there. I am new to this game, but looking to purchase a buy and hold fixer upper property (preferable a duplex) in the Germantown area within the next few months. Any good contacts (agent, lender, contractor, etc) you feel inclined to share would be much appreciated.
Also, I applied for the Jumpstart Germantown Mentoring program - anyone have advice/opinion about that??
Philadelphia, PA · Member since 2016 · 12 posts · 4 votes
9y
@Lori Spadaro Jumpstart Germantown is a fantastic program, and you'd be a great candidate. I'd encourage you to go ahead and join the Jumpstart developers network on facebook - lots of interesting things being discussed there. There is also a series of training videos available on their website if you hadn't seen those yet, which I think you would find really useful.
I'm new at this myself, but please feel free to reach out to me directly if you'd like to chat more! Good luck to you!
Real Estate Agent · Philadelphia, PA · Member since 2015 · 51 posts · 9 votes
9y
Kathryn- Can you PM the addresses of the places you were looking at in Germantown that you didn't buy? I'm the buyer agent on a deal in Germantown right now. I'm wondering if it was the same seller.
Lori- I'd be happy to talk with talk with you about the area sometime. I'm not greatly experienced there, but I've been looking a lot recently.
Philadelphia, PA · Member since 2017 · 7 posts · 1 vote
9y
@Kathryn Krueger Hey Kathryn, I'm a licensed agent as well as a wholesaler that deals with Germantown properties on a regular basis every month. Shoot me a direct message when you get a chance. I have some helpful info for you.