Are there any good markets in Pennsylvania ??

Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes

Looking to possibly invest somewhere in Pennsylvania... I live in NJ and there aren’t any deals here. I was reading some blogs and was told Pennsylvania had some areas that were decent to invest... anyone have any experience in that area or have knowledge of any other markets in other states I can invest in ?

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Chris K.

Attorney · Nashville, TN · Member since 2015 · 1k+ posts · 1k+ votes

@Anthony Liguori

If you look at Pennsylvania as a whole, you have the following markets:

1.Philadelphia/Pittsburgh: the two largest markets. They have millions of people living there.

2. Allentown/Lehigh Valley Area: the third-largest market. This area has almost a million people living there.

3. Tertiary Markets: Scranton/Wilkes-Barre, Harrisburg, Lancaster, York/Hanover, Reading, and their suburbs. Typically they have around half a million people living in the area.

4. Everything Else: places like State College, Stroudsburg, and Erie where fewer people live.

Each market has its version of Class A areas and War Zone areas. But as a general rule, cap rates get higher as you go down the list. An investor can make money in any of them. But the strategy will need to change depending on what you want to do.

If you want to look at the Scranton market, look into the suburbs as well in both Scranton and Wilkes-Barre. Everything cash flows at least on paper. The number one mistake I see people make is underestimating reserves. Also, there's no meaningful natural appreciation in these tertiary markets. It more or less keeps up with inflation but not much more. Not an expert in other markets, but I would say that's true for other areas like Harrisburg, Lancaster, York/Hanover, and Reading.

My number one advice to remote investors is to: (1) pick a market; and (2) create a good team around you. Most remote investors do not fail because they picked a bad market. They fail because they don't have a good team. Now the common problem is that most remote investors cannot build a good team because they cannot afford them. Savvy team members understand the Pareto distribution --- so they want to work with investors that they can get consistent work from. Your goal is to make sure your incentives line up with your team members. In my opinion, that requires the investors to focus on a market to get to a point where they have enough projects there to sustain a good team.

Just my two cents.

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.

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Joseph CacciapagliaBusiness Member
Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
6y
I left the NJ/PA/NY markets to move to Texas, in large part because it's much easier to make deals work here and real estate is my primary income. However, I strongly believe there are deals to be had in every market. Have you checked out the Palmyra, Riverton, Cinnaminson area in NJ? I still have one property left there, and it would be a 1% property if I listed it at current prices, and it cash flows well. I'm sure there are plenty of similar deals to be had in that area. You might just have to work at it a bit.
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Alex Deacon
Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Anthony Liguori The Pittsburgh market is a great start for a few reasons. The prices here are affordable and the ROI is still pretty good. Its becoming harder to find a good deal all over the nation but there are still opportunities in all markets and in Pittsburgh.
2 Reply
Patrick LiskaPro Member
Investor · Verona, NJ · Member since 2014 · 1k+ posts · 832 votes
6y
That depends on how you want to invest, fix/flip, buy for appreciation, buy and hold for income, wholesale. some areas i am sure will appreciate, a lot of areas you can make little income on them if you rent but the tenants are paying down the mortgage and other expenses, if you are in it for the long run, when you go to sell, you will have all the equity in it that the tenants paid for. it all depends on what you are looking to do
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Anthony Angotti
Real Estate Agent · Pittsburgh, PA · Member since 2015 · 1k+ posts · 846 votes
6y
@Anthony Liguori Pittsburgh is a great market with great price to rent ratios.
You need someone on your side who understands the nuances of the different neighborhoods, but it's still pretty affordable to buy a building that can provide healthy cash flow with some improvements.
2 Reply
Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@nasser Haddad I'm interested in a light fix and flip and possibly some rentals to hold on..
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Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@anthony angotti I will look into the Pittsburgh area. One area that I was looking at was Scranton,PA .. You have any insight on that market?
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Max FeinbergPro Member
Real Estate Agent · Pittsburgh, PA · Member since 2017 · 152 posts · 70 votes
6y
@Anthony Liguori what type of investing are you most interested in?
0 Reply
Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
I was interested in a possible small fix and flip and 2-4 unit multi family homes. maybe 5 unit if the price is right.. I was looking into Scranton, PA . I saw a lot homes for cheap.. any advice?
0 Reply
Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@Max Feinberg
I replied back but it didn’t mention you. Just read my reply
0 Reply
Alex Kreeger
Member since 2019 · 63 posts · 60 votes
6y
@Anthony Liguori I have been finding some turnkey, already occupied 1% rule rentals in south central pa.
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Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@Alex Kreeger
What are the towns ?
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Alex Kreeger
Member since 2019 · 63 posts · 60 votes
6y
@Anthony Liguori Harrisburg, Lancaster, York, and etc
0 Reply
David Bokman
Real Estate Investor/Wholesaler · Philadelphia, PA · Member since 2015 · 757 posts · 318 votes
6y
Well, Philadelphia is one of the best places to invest and has been for the last few years, we have some of the hottest zip codes all over the country, there are ALSO TONS of pockets and areas all over Philadelphia and just outside in the nearby counties -Chester, Delaware, Montgomery counties all have pockets that are good for investing. Sounds like you have a lot of home work to do!
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Chris K.
Attorney · Nashville, TN · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Anthony Liguori
If you look at Pennsylvania as a whole, you have the following markets:
1.Philadelphia/Pittsburgh: the two largest markets. They have millions of people living there.
2. Allentown/Lehigh Valley Area: the third-largest market. This area has almost a million people living there.
3. Tertiary Markets: Scranton/Wilkes-Barre, Harrisburg, Lancaster, York/Hanover, Reading, and their suburbs. Typically they have around half a million people living in the area.
4. Everything Else: places like State College, Stroudsburg, and Erie where fewer people live.
Each market has its version of Class A areas and War Zone areas. But as a general rule, cap rates get higher as you go down the list. An investor can make money in any of them. But the strategy will need to change depending on what you want to do.
If you want to look at the Scranton market, look into the suburbs as well in both Scranton and Wilkes-Barre. Everything cash flows at least on paper. The number one mistake I see people make is underestimating reserves. Also, there's no meaningful natural appreciation in these tertiary markets. It more or less keeps up with inflation but not much more. Not an expert in other markets, but I would say that's true for other areas like Harrisburg, Lancaster, York/Hanover, and Reading.
My number one advice to remote investors is to: (1) pick a market; and (2) create a good team around you. Most remote investors do not fail because they picked a bad market. They fail because they don't have a good team. Now the common problem is that most remote investors cannot build a good team because they cannot afford them. Savvy team members understand the Pareto distribution --- so they want to work with investors that they can get consistent work from. Your goal is to make sure your incentives line up with your team members. In my opinion, that requires the investors to focus on a market to get to a point where they have enough projects there to sustain a good team.
Just my two cents.
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.

5 Reply
Joe Chirdon
Real Estate Agent · Harrisburg, PA · Member since 2016 · 159 posts · 82 votes
6y
Camp Hill
1 Reply
Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@David Bokman
So Lackawanna county is out ?? Lol
0 Reply
David Bokman
Real Estate Investor/Wholesaler · Philadelphia, PA · Member since 2015 · 757 posts · 318 votes
6y
@Anthony Liguori HAHA......LackaWhAT????? Yeah, I would say it's out! lol
All though depending on your strategy you can find some pockets of PA where the cash flow is good BUT zero appreciation of the homes.
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Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@David Bokman
Damn I got my hopes up for nothing lol... I would love to connect with you to pick your brain a little bit about PA. I live in NJ and looking to invest somewhere a little cheaper because NJ prices are just out of control ...
0 Reply
Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@Nasser Haddad
I’m interested in possibly a small fix and flip and some multi families to hold for rentals ...
0 Reply
David Bokman
Real Estate Investor/Wholesaler · Philadelphia, PA · Member since 2015 · 757 posts · 318 votes
6y
@Anthony Liguori feel free to reach out anytime just keep in mind that PA is very large and you will run into the same issues here as in NJ. For example parts of Philadelphia are just as expensive as NJ if not more in certain areas. So its all gonna come down to your strategy and what you're looking to do.
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Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@Nasser Haddad
Which area do you recommend?? I been hearing a lot about Philadelphia area. I was looking at Lackawanna county but I been hearing to satay because of appreciation although rentals might be good to hold in that area. So I’m kind of stuck
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Anthony Liguori
OP
Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
6y
@David Bokman
I was just looking to possibly do a small fix and flip of possible and get some 2-4 unit rentals. Possibly section 8. Since the houses were kinda cheap in the Lackawanna area. I was doing the numbers and it made sense. But I’m not sure not because no one is really talking about Scranton lol... I might have to look else where.
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Chris K.
Attorney · Nashville, TN · Member since 2015 · 1k+ posts · 1k+ votes
6y
@Anthony Liguori

Try reaching out to @Adam Guiffrida and @Marc Winter. Adam is a very successful investor in the area with a large portfolio there. Marc is an excellent property manager in the area and very involved in the real estate community. There are also other investor friends of mine with multi-million dollar portfolios there. Not sure what their schedule is like but perhaps they can give some insights if they have a second.

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.
0 Reply
Karl B.
Rental Property Investor · Erie, PA · Member since 2015 · 1k+ posts · 2k+ votes
6y
Depends on what you're looking for. Cash flow? Appreciation?

I started my landlording journey by investing in Erie (I grew up there so I know the area well). It's amazing for cash flow. Appreciation is pretty much next to zero.

Also, to succeed in Erie one needs to know the area well as well as the market; one issue Erie has is pretty much all property management there sucks so lots of out of state investors (who decide to invest in Erie when the cash flow numbers seduce them) get burned.

Do you have family/friends in cities across the country? Would they be willing to help you by telling you the good/bad areas of the city and show your properties when they need rented? If so, consider investing in that market and research the market to see if it aligns with your investing goals.

Having friends/family local to an area to help you with your properties is a great strategy to have.
2 Reply
Account Closed
Rental Property Investor · Mechanicsburg, PA · Member since 2018 · 281 posts · 176 votes
6y
@Anthony Liguori Have you looked into Cumberland County, PA (cities of Camp Hill, Mechanicsburg & Carlisle)?
https://www.ccpa.net/59/County-Facts
https://www.visitcumberlandvalley.com/
Cumberland county is fastest growing PA county over last decade. Just west of Dauphin County (which includes capital city of Harrisburg & Hershey).
Best of luck
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