Help me analyze this property in Allentown, PA

13 Replies

I am thinking about investing in Allentown, PA and would love some help with analyzing property.  

Here is an example of something I came across:

http://www.zillow.com/homes/for_sale/2122-W-Libert...

Can someone give me an opinion on why this is a good/bad investment?

I don't plan on buying it at this point but I need to know if my analysis is accurate so I can learn what to look for in the future.

I appreciate any feedback!

Hi Brian. We would need some additional information on this property in order to analyze this for you. For instance, what are market rents for this property/area? Taxes? Are utilities separate or are you responsible for them? Whats the vacancy rate for the area? Financing terms that you were considering? Just thoughts...good luck though.

Brian,

What are you looking for in an investment? That property on the west end may get 1100-1250 in rent, but for the money there are much better things to buy. Not sure how passive of an investor you are or what your goals are. That would help me answer your question a bit better

Joe

Nice neighborhood, but that price is too high for the rent you will collect. However, this is a short sale, so the listing price is irrelevant. I have found that most realtors don't know how to do short sales for investors.

i always put in 10% in allentown. The biggest factor in this city is picking the right tenant. We require a landlord reference, 3x the monthly rent in monthly income and we search the district judge website for previous evictions. If any come up we dont allow the tenant to move in.

I buy my eviction reports, because they search multiple states.   I use a small company, rentalresearchonline.org, but there are others.      The vacancy rate in Allentown, as a whole, is actually quite high because of all the bank owned homes.    But that also contributes to the high demand.    At this time of year, I am swamped with calls if I price the vacancy at market rate.   Investor beware though, vacancy rates can change based on local economic shifts.   I once owned a home in Florida and always had multiple applicants.   Then when a large local employer shut down, It took me six months to find a tenant.   

You can use renterinc.com to request landlord references online instead of calling the or faxing the previous landlords. Plus you'll be able to see if landlords already shared their landlord references about your applicant.

Hi Brian 

I think this deal would be much more attractive if you were able to get it under contract around 90-100k. As Joe mentioned in that area you can probably rent at about $1200 and 8-10% vacancy is fair. 

I am active in the Allentown market and also live in NY. Lets connect sometime.