All Forum Posts by: Mark Peteritas

Our latest 506C Investment fund, in partnership with @TheDeRosaGroup, is filling up quickly. Reserve your spot now to take advantage of projected 15%+ annualized returns. 

This fund is for accredited investors only.

I am located in Lancaster, PA. The property we are buying is a 336 unit apartment complex located in Winston Salem, NC.

Contact me for more information.

I second what Nate said.  We try to buy > 8% and honestly it can be tough to find those deals right now but they are out there if you can get things before they list.

These are all good points and worth considering.  The way water is billed (and the rules of passing along those bills to tenants) varies by municipality.  In Lancaster city, and plenty of other towns in the area, water metering is on a per building basis, not a per unit basis.  Individual metering outside of that can be done, but it is generally not condoned by the municipalities.  Lancaster city for example does not allow those expenses to be billed to the tenant, although they tolerate it being done for single family homes.  So the general rule I tend to use is that for multi-unit properties, in central pa, the owner is responsible for water/sewer/trash, since there is not a good, legal way to split it up.

It sounds like you have a target you are looking to hit, which is great.  Just be careful not to be honest with your numbers, so that you really do hit or beat your targets.

Mark

Yeah, PA taxes in general, and especially Lancaster city properties, have a pretty high tax rate.  The taxes above sound appropriate for the area.  Others have mentioned it as well, but make sure to include maintenance, vacancy, and management (if you aren't self managing) in your calculations.  It is easy to leave those out, but they are real expenses and over time will affect your bottom line.  Make sure you have real numbers for your insurance and utilities as well.  You will be paying water/sewer/trash, and common electric judging by the building type. What about the heat... hopefully the heat is separated?

I like to estimate everything high, and then beat the estimates, rather than estimating low and ending up in the red.

Mark

I've been investing in Lancaster city for over 10 years. The market is a little tough right now. Prices are high and cap rate is low. That being said there are still some deals out there. The market got healthier as the summer went on and supply is pretty decent right now. Things are just over priced since the summer started as a sellers market. 

Mark

If this is for smaller properties... Singles, doubles, etc, I usually go with Erie as my first choice. Donegal is my second. Both have great rates and the coverage you want for loss of use, etc. 

Lancaster's average cap rate for small investment has been narrowing in the last 2 years, as competition and prices go up.  Rents are also going up but not with the pace of housing prices.  So I would say on AVERAGE you're looking at around 7% cap rates currently, which is ok, but not amazing.  There were more value add opportunities in the desired west end and downtown a few years ago.  Those have largely dried up.  And regarding the Amish, I would NOT follow the Amish for a few reasons... 1) the Amish are not looking to improve communities, as they are not part of the city community. Minimal investment and return are really their only goals in my experience (not that these shouldn't be on their list, but they tend to be the only goals). 2) they don't live in the city so they don't know the city as well and just tend to buy where prices are low. 3) the quality of work done on their properties tends to be a little below the average investor quality, so honestly I feel as a group they pull value and rents down where they invest, rather than the opposite.

There are plenty of us out there who DO care about community focus and try to affect positive change.  I've been investing (slowly) for the last 10 years in Lancaster city and I do feel it is still a great place to live and there are some good opportunities, but they are getting hard(er) to find.  If you are interested in investing in Lancaster city, I would recommend doing your homework first to find the areas of town where you would be comfortable living and focus the search there.  Just my 2 cents!

Mark

I'm also wondering if the Lancaster meetings are worthwhile.  Are there any regular attendees who would like to share their thoughts?  May I put in a vote to move it from Lancaster Bible College to Lancaster Brewing Company? ;)

I have had one seller require an nda because their tenants or prospective tenants did not want their info shared. But that was a commercial deal. For residential deals it's absolutely standard to have full leases as soon as the property is under agreement. This is vital information you need to properly do your due diligence, so keep pushing until you get it!

Mark

Mark here from Lancaster, PA.  I'm new to Bigger Pockets, but I've been at the real estate game for a while, I guess a little over 10 years now.  I've always worked a day job too (although I would like that to change), and so I've been doing the slow and steady approach.  I'm currently holding 7 properties / 11 units after unloading a couple late last year.  I've done a couple flips, but mostly buy and holds, learning as I go like the rest.  I'm currently looking to get into some bigger projects than the singles and doubles I have done thus far.  I am starting to leverage using the equity from the current holds and would like to test the waters of either partnering with folks on bigger projects or raising money to chase them as the lead.  So anyway, hello and let me know if anyone has contacts or recommendations!

-Mark