[Calc Review] Help me analyze this deal - Pittsburgh

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[Calc Review] Help me analyze this deal - Pittsburgh

Joseph Platyan
Insurance Agent · Member since 2018 · 59 posts · 17 votes

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*This link comes directly from our calculators, based on information input by the member who posted.

Hi group! 

I am wondering if my numbers are correct here for this Pittsburgh home? 

Are rents for a 3 bed 1 bath in 15235 around $1,000? 

What are your thoughts on this deal? 

Thanks! 

- Joe 

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Jon Behlke
Accountant · Hopwood, PA · Member since 2015 · 125 posts · 92 votes
7y

Penn Hills School District grossly mismanaged millions a few years back and property taxes are increasing dramatically every year as they scramble to fix their situation.  I would personally steer clear of the area unless you really enjoy throwing rent money at property taxes. 

https://triblive.com/local/penn-hills/penn-hills-real-estate-taxes-expected-to-go-up-to-help-balance-the-districts-2019-20-budget/

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  • David Lee Hall, III
    Rental Property Investor · Pittsburgh, PA · Member since 2019 · 530 posts · 511 votes
    7y

    Just my two cents but it doesn't look far off on numbers for Penn Hills. You might want to make sure you are comfortable with the numbers at $900/month in case you need to increase demand via a good deal. It isn't a high demand area, but there are a lot worse. 

    1Reply
  • Mike Pastor
    Investor · Pittsburgh, PA · Member since 2015 · 63 posts · 26 votes
    7y

    Your calculations look ok, but I think purchase price and roi are off for the area.  It's not too hard to find similar properties with the same rent for 50-60k in Penn Hills

    1Reply
  • Jon Behlke
    Accountant · Hopwood, PA · Member since 2015 · 125 posts · 92 votes
    7y

    Penn Hills School District grossly mismanaged millions a few years back and property taxes are increasing dramatically every year as they scramble to fix their situation.  I would personally steer clear of the area unless you really enjoy throwing rent money at property taxes. 

    https://triblive.com/local/penn-hills/penn-hills-real-estate-taxes-expected-to-go-up-to-help-balance-the-districts-2019-20-budget/

    2Reply
  • Joseph Platyan
    OP
    Insurance Agent · Member since 2018 · 59 posts · 17 votes
    7y

    Awesome thank you all for your help! 

    0Reply
  • Alex Deacon
    Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
    7y

    @Joseph Platyan you are paying way too much for the area with a rent amount of $1,000. if it was a better school district and a highly desirable area to live then those numbers are not bad but it isnt

    0Reply
  • Anthony Angotti
    Real Estate Agent · Pittsburgh, PA · Member since 2015 · 1k+ posts · 846 votes
    7y

    @Joseph Platyan

    I think the price is a bit high for a rental there as well. 

    In addition you have $48.58 for property taxes per month. I'd be prepared for that to go up if you buy around 100k. 

    Use this link to calculate a few different scenarios: http://www.anytimeestimate.com/CALCULATORS/pa-allegheny-calculator.htm

    Assessment values are based on the common level ratio in Allegheny County which combined with comps might be able to get your assessment down, but if there's a large difference between current assessed value and purchase price you're likely going to get a hefty cash flow killing increase. 

    In addition do you have a prop management amount expense? Get some costs from managers in the area. You'll be looking at a monthly fee, lease up fees, lease renewal fees, and ask if any costs associated with maintenance 

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