Philadelphia Engineer & Architect, Starting REI Journey

[Liz Spina]

Hello everyone,

I am from Delaware County, PA, (Delco!) just outside of Philadelphia.  I have an engineering background, and for my day job, am currently in a technical sales role.  My husband is a licensed architect in Philly.  We are looking to start our real estate investment journey locally, which is a little overwhelming because Philly is so hot right now.  

I would like to BRRRR some properties, using private lenders so that I can pay cash to get good deals and build a lot of equity. The challenge is that I would like to be all in for $50k cash, so maybe a purchase price of $35k and rehab price of $15, or something along those lines. We are willing to put in some sweat equity in the beginning. We are doing a "live in flip" right now with our current residence, so we are used to projects.

I saw someone post that they had similar numbers in the Elmwood part of Philadelphia.  Any insight into this neighborhood or similar fringe neighborhoods (ideally with potential for appreciation) are very much appreciated.  My first goal right now is to hone in on a market niche so that I can really start analyzing deals for practice, while I line up my team.

I became familiar with BP through the podcast and have become a little obsessed.  I am attending the webinars, reading lots of books, and trying to learn as much as I can right now.

Thanks for reading and I look forward to connecting with you.

[Rich O'Neill]

@Liz Spina Welcome! Glad to have you here! 

@James Masotti is spot on. I invest in DelCo and C/D properties are what I deal with. Numbers look great up front but repairs, evictions, and challenging tenants eat into the numbers. I still love this niche but just understand what you are getting into. I have built my team to be able to handle these issues efficiently so it does not bother me much any more. In the beginning though, it was a lot of work. 

With the same $50k, you could also look into putting a down payment on a larger multi unit in a nicer neighborhood. I don't know the city as well but that same $50k as a 20% down payment could probably buy you a duplex or triplex in decent parts of Delco- Ridley, Springfield, Etc. Or you could use hard money to finance the purchase and renovation then BRRRR it. This way you could roll the $50k into much more properties faster and leverage your husbands presumably decent salary to help qualify for loans.

So many options! Best thing to do in my opinion is take a hard look at what you want your lifestyle to be and build your investing business around that. In my case, I decided I was willing to work my tail off full time in this business for 7-10 years accumulating C/D properties and dealing with all of the headaches that come along with that and then turn it all over to a great property manager and collect cash flow. There will still be a lot of work managing the manager but it will be significantly less work and I can do it from wherever I want. 

Best of luck and be sure to ask questions in here. The more specific the better. There are several of us Delco investors/agents active on the site including @John Knisely, @Vincent Garman, @Ray Peslar, and many more.