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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
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Getting started in Philadelphia

Riccardo Dalla
  • New to Real Estate
  • Boston, MA
Posted Nov 8 2022, 19:02

Hey everyone! I'm a newbie living in Boston and want to invest in Philadelphia (family there, some knowledge of the city, adequate price point). I've started looking at and analyzing some deals, but I was wondering if anyone had tips on the best neighborhoods to look at considering profitability as well as crime rates etc.

And has anyone here had any kind of issues with crime when investing in Philly?

Thanks!!

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Cj Koch
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Replied Nov 9 2022, 05:15

Hey Riccardo, I think Grays Ferry is decent, all things relative. Plus it's within close proximity to strong neighborhoods like University City and Graduate Hospital. Best of luck!

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Eric Greenberg
  • Investor
  • Philadelphia, PA
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Eric Greenberg
  • Investor
  • Philadelphia, PA
Replied Nov 9 2022, 05:40

Hi Riccardo,

Choosing a neighborhood can be challenging. Id ask what your goals are, type & class of property you are looking for, budget, and if you plan to hire a PM or do it on your own with your local friends/family. 

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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
Replied Nov 9 2022, 05:58
Quote from @Eric Greenberg:

Hi Riccardo,

Choosing a neighborhood can be challenging. Id ask what your goals are, type & class of property you are looking for, budget, and if you plan to hire a PM or do it on your own with your local friends/family. 

Hi Eric, thanks for this. I'm looking at single family units in the $150k-$300k price range. Given my inexperience I'd like to start with a turnkey (or anything that needs close to zero upfront work). Goal would be to have a decent ($200+) cash flow and I plan to hire a PM unless I find something downtown, which I doubt.

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Matthew Niemynski
  • Wholesaler
  • Philadelphia, PA
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Matthew Niemynski
  • Wholesaler
  • Philadelphia, PA
Replied Nov 9 2022, 06:30

Hey Riccardo, 

I work with a ton of investors and many of them are looking in West and South Philly. More specifically Cobbs Creek, Point Breeze, Grays Ferry, and Girard Estates.

I personally live in Grays Ferry and never had any problems - high rents too. 

Would love to connect!

Matt

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Eric Greenberg
  • Investor
  • Philadelphia, PA
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Eric Greenberg
  • Investor
  • Philadelphia, PA
Replied Nov 9 2022, 13:52
Quote from @Riccardo Dalla:
Quote from @Eric Greenberg:

Hi Riccardo,

Choosing a neighborhood can be challenging. Id ask what your goals are, type & class of property you are looking for, budget, and if you plan to hire a PM or do it on your own with your local friends/family. 

Hi Eric, thanks for this. I'm looking at single family units in the $150k-$300k price range. Given my inexperience I'd like to start with a turnkey (or anything that needs close to zero upfront work). Goal would be to have a decent ($200+) cash flow and I plan to hire a PM unless I find something downtown, which I doubt.

And the plan would be for a long term buy and hold with long term renters? Would you be putting 25% down and leaving it in the deal? 

At $300k purchase and 25% down ($75k) your monthly payment at 7% is roughly $1900/mo with taxes and insurance. That would mean you would need to charge about $3k in rent to end up with about $200 in monthly profit after PM/vacancy/CapEX/maintenance/etc. 

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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
Replied Nov 9 2022, 14:42
Quote from @Eric Greenberg:
Quote from @Riccardo Dalla:
Quote from @Eric Greenberg:

Hi Riccardo,

Choosing a neighborhood can be challenging. Id ask what your goals are, type & class of property you are looking for, budget, and if you plan to hire a PM or do it on your own with your local friends/family. 

Hi Eric, thanks for this. I'm looking at single family units in the $150k-$300k price range. Given my inexperience I'd like to start with a turnkey (or anything that needs close to zero upfront work). Goal would be to have a decent ($200+) cash flow and I plan to hire a PM unless I find something downtown, which I doubt.

And the plan would be for a long term buy and hold with long term renters? Would you be putting 25% down and leaving it in the deal? 

At $300k purchase and 25% down ($75k) your monthly payment at 7% is roughly $1900/mo with taxes and insurance. That would mean you would need to charge about $3k in rent to end up with about $200 in monthly profit after PM/vacancy/CapEX/maintenance/etc. 

Buy and hold & long term rental, yes. Plan is to put 20% down, depending on the price point.

Thank you for those numbers! I think I'm pretty confident in analysing the numbers - I'm mostly trying to figure out what the best neighborhoods are where I can find properties with those characteristics. The comments above are already helping! Do you have anything else in mind?

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Eric Greenberg
  • Investor
  • Philadelphia, PA
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Eric Greenberg
  • Investor
  • Philadelphia, PA
Replied Nov 9 2022, 17:01
Quote from @Riccardo Dalla:.

Thank you for those numbers! I think I'm pretty confident in analysing the numbers - I'm mostly trying to figure out what the best neighborhoods are where I can find properties with those characteristics. The comments above are already helping! Do you have anything else in mind?

Are folks giving investment property loans on 20% DPs right now? 

My rough illustration of those numbers is a way to use the MLS to find areas in the city that have turn key properties for $300k and below. Then using Zillow/Rentometer/etc look if that type of property yields the type of rent you need to meet your investing goals.

When I look at point breeze everything thats $3k+ rents are newer construction or new rehabs, 3+ bedroom, and over 1750sqft (ie a good buy box for that area). The downside I see is the handful of properties I looked at were all up for sale prior to being listed for rent and were well over $500k, ie not that close to the $300k that makes sense with the rough numbers to get to your goals.

This is just a quick example of how you can look in areas to see if they make sense. On top of that like you said use a crime map to understand that for example you may be able to crush your $$ goals in lets say Kensington, but youll be in a C/D location and will have to deal with everything good and bad that goes along with that.  

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Rick Land
  • Realtor
  • Philadelphia, PA
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Rick Land
  • Realtor
  • Philadelphia, PA
Replied Nov 9 2022, 18:20

Hey Riccardo, I’m a realtor in Philadelphia and happy to help point you in the right direction. As some have already mentioned, Point Breeze and Grays Ferry are very popular with investors.

I’m bullish on West Philly in general, Saint Joseph’s university 
recently opened a new campus and the amount of new jobs being created in that area have made it very popular among the investors I work with. 

I’d recommend looking in Kingsessing, Squirrel Hill, and Brewerytown. 

In your price range, I’d also highly suggest looking in the Northeast section of the city. Areas like Olde Kensington, Port Richmond and Mayfair have become extremely popular. Happy to help if you’d like to connect!



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Rob Lawrence
  • Real Estate Agent
  • West Chester, PA
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Rob Lawrence
  • Real Estate Agent
  • West Chester, PA
Replied Nov 10 2022, 06:49

Hi Riccardo, 

I work in the suburbs outside of Philadelphia if that is something you are interested in exploring.

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Rich O'Neill
  • Contractor
  • Chadds Ford, PA
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Rich O'Neill
  • Contractor
  • Chadds Ford, PA
Replied Nov 11 2022, 13:08
Quote from @Rob Lawrence:

Hi Riccardo, 

I work in the suburbs outside of Philadelphia if that is something you are interested in exploring.


 Definitely worth looking in the suburbs. With rates where they are the numbers are likely to be tight anywhere, but you may be able to make it happen outside the city. In Delco there are plenty of turnkey or close to turnkey properties for under $175k that should rent in the $1,600 range, which should theoretically get you close to $200/month. Buy a duplex/triplex/quad and you're in even better shape. 

Contractor PA (#PA157760)

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Rich O'Neill
  • Contractor
  • Chadds Ford, PA
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Rich O'Neill
  • Contractor
  • Chadds Ford, PA
Replied Nov 11 2022, 13:11

Also, @Jimmy O'Connor did an excellent write up on this a while back. I am sure the numbers are dated by now but gives you a starting point. https://www.biggerpockets.com/...

Contractor PA (#PA157760)

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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
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Riccardo Dalla
  • New to Real Estate
  • Boston, MA
Replied Nov 11 2022, 13:34
Quote from @Rich O'Neill:

Also, @Jimmy O'Connor did an excellent write up on this a while back. I am sure the numbers are dated by now but gives you a starting point. https://www.biggerpockets.com/...


 Love it, Rich! Thanks for both your replies. This is very useful!

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Jussi Lundstedt
  • Rental Property Investor
  • Philadelphia, PA
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Jussi Lundstedt
  • Rental Property Investor
  • Philadelphia, PA
Replied Nov 13 2022, 17:51
Quote from @Eric Greenberg:

Are folks giving investment property loans on 20% DPs right now? 

My lender at least is still doing 20% down programs for investment properties. However, last I asked, I was quoted 1.75 points more for a 20% down instead of 25%, which makes it kind of redundant... Might as well pony up a little extra cash and put it in the deal instead.

Personally we own a couple of properties in the Manayunk/Roxborough area that we bought and did light work like cosmetic updates and roofing fixes on before renting them out. As the market is softening, you might be able to buy a 4bd/1.5-2ba on a good deal for under 300k, do limited work, and rent it out in the high $2k range to what is a good tenant base.

We're starting to think about doing a more extensive renovation for the next project and for that we're looking at South Philly (Grays Ferry/Point Breeze in southwest or Whitman/Pennsport in southeast). Good luck out there!

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Stephen Kennedy
  • Real Estate Agent
  • PA, Philadelphia
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Stephen Kennedy
  • Real Estate Agent
  • PA, Philadelphia
Replied Nov 14 2022, 08:18

Hey there, 

Recommend working with a local agent who specializes and or also invests in the city. DM to discuss more! 

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James Wise
  • Real Estate Broker
  • Cleveland, OH
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James Wise
  • Real Estate Broker
  • Cleveland, OH
Replied Nov 18 2022, 06:02
Quote from @Riccardo Dalla:

Hey everyone! I'm a newbie living in Boston and want to invest in Philadelphia (family there, some knowledge of the city, adequate price point). I've started looking at and analyzing some deals, but I was wondering if anyone had tips on the best neighborhoods to look at considering profitability as well as crime rates etc.

And has anyone here had any kind of issues with crime when investing in Philly?

Thanks!!


 Welcome aboard R-Money

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Replied Nov 20 2022, 10:44

E Locust Ave is good too. I recently had one under contract but sec 8 tenant had a long term contract.

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Karl Schnitzer
  • Real Estate Consultant
  • Philadelphia, PA
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Karl Schnitzer
  • Real Estate Consultant
  • Philadelphia, PA
Replied Nov 21 2022, 18:06

Hey man- I’m a former Philly cop also an investor and realtor. I probably have an above average knowledge on crime in the city as well as real estate im able to share with people and my clients. Feel free to reach out if you have any specific questions.