Does anyone who lives out of state buy and hold in Philadelphia?

[Whitney Anne Kwek]

Hey everyone - of those who have buy and hold/rental properties in Philadephia, are any of you investing from out of state or at a distance?

I have a family member moving to Philly and buying her first residence. I was interested in looking at properties when I go visit her, but I noticed the property taxes are pretty high. She mentioned it's due to a high base tax for local schools.

I would appreciate if anyone could share their experiences in Philly if they are investing from a distance. Do your properties cash flow? Do you have a property manager? What are some challenges you've faced since you can't visit the property or meet with members of your team in person?

[Lu Kang]

As Kyle, mentioned it depends on locations within the city. I have properties in Manayunk (19128) which seem to have a higher property tax assessment then my property in Point Breeze (19146), even thought Point Breeze is a hotter location. 

I'm actually in the suburbs (Montgomery County), and in comparison Philadelphia has lower Property taxes then surrounding areas, since they get a lot of their tax base from the wage tax. Since your family member is moving to Philadelphia, they have the advantage of house hacking and get preferred rates. In terms of cash flowing, I would say its gotten harder as the Philadelphia real estate (entry level homes) have appreciated. You can find deals where the rent is above your PITI, but once you factor in PM costs, vacanacy and repairs it won't actually make you that much.

I self manage 3 properties and 1 is managed by PM. In terms of cash flowing, they cash flow if you based it on my original purchase price / mortgage starting in 2012 - 2017. Since I've refinanced all my properties, and pulling out all my equity for other investments. It's practically a push as one major repair will wipe away the gains in a year. 

If you are investing from a distance, there are def other markets in PA (Allentown Area, Pittsburgh Area, Harrisburg Area) that will give you better cash flow. But in terms of Appreciation I think Philadelphia is better and buying taking that equity I'm able to scale to other things.