19140 North Philly Market

11 Replies

Hi BP,

Anyone have any familiarity with the 19140 Zip code in Philadelphia. I know it's not THERE yet, but is this a market that can be seen as up and coming? 


Any help would be greatly appreciated.

Thanks!

I just looked it up on Zillow.  It looks like a low-priced neighborhood around $40,000 - $70,000 with rehabs running around $120,00 for 3BR.  Taxes are low in Philadelphia.  My initial reaction to that is it says, "War zone!", but I don't know the area  Beware buying a higher priced rehab in a lower priced neighborhood.  You can benefit tremendously if you are the early buyer, but you can also lose a lot if you are the last rehab buyer, not that there won't ever be another buyer.  You would be buying at the top of the short-term market.

It looks like the properties up to $70k would cash flow well, depending on the type of tenant you get.  It is prime Section 8 territory.  I don't know that the higher priced rehabs would cash flow as well as it isn't clear you could charge a significantly higher rent.

What draws your interest?

Thanks @James Mc Ree , I'm actually looking into the Section 8 stuff over there. What draws me is it's in the city and right now there is nothing doing but in a bunch of years it has a lot of upside. That being said I would only look into deals that have cash flow right now and look at the appreciation as the cherry on top (big cherry:). Also, i'm a newbie and seems like an area where I can purchase stuff.

@Bennett Schwartz

A quick look at the data does not paint a great picture of 19140

Food stamp and poverty rates are profoundly high, and poverty in particular is on the rise. 

College education rates are also really low at 6%

Rent to income rates are increasing rapidly and show a rent-burdened tenant base in the area

Yield metrics such as cap rate and rent to price ratio are both high and increasing, indicating a growing perceived market risk

The fundamentals also look rather bleak with homes values seemingly stagnant and population numbers declining rather quickly.  

While the area may pick up in the coming years, the data does not suggest this is currently occurring nor that it will any time soon. As a newer investor I suggest you focus on a more moderate location with lower risk and less speculative upside. 

Might not be what you wanted to hear, but thats my two cents

Hope this helps!

Hi, Bennett , i am a newly licensed agent,and looking to invest myself but soon as i noticed the zip code it caught my attention. i am from the north Philadelphia side of town since 1994. The main upside i have seen in the area is the student housing niche. schools such as temple, la Salle etc are in respective distances to students who rather live off campus. I've also notice rooming houses becoming more popular. On the down side Criminal rate and poor school districts would be my concern. From my experiences it's not a complete war zone but it would not be considered b class or higher, area has a lot of distress housing as well but affordable.

hope this helps Good luck

Hey @Bennett Schwartz , we actually met once at a triplex over by Temple. I've seen a lot of money being pumped into the area and property values rising. This zip code was actually heavily discussed in this thread https://www.biggerpockets.com/forums/52/topics/775692-investing-in-philadelphia-19140 where myself and a couple other people active in this area weighed in. I would scroll through these posts.

@Art Perkitny   Philadelphia is a bit of a different beast where metrics like college education hold less weight, around here commercial development by proximity and what is in the  City's comprehensive plan is king, especially since Philly's value is in its evident boom of city-wide appreciation.  This area is on the path of progress as Temple University begins to expand its influence northwards, especially since initial plans for Temple U's own foot ball stadium for its North Broad Street Campus. In 19140 you are close to Temple University Hospital and Einstein just north in 19141, both right off the broad street line. These two places are major providers for jobs in that pocket for any potential renter. You have easy access to Center City via public transport and the city has plans on reformating the plaza at broad and Erie to put in a Marriot and other commercial spaces. Is it a renters market? Yes, of course, you're selling homes that are worth in the low 100's but that's the point of being a buy and hold early on so you can see the rapid appreciation that Philly has been known for so you are not kicking yourself later.