New Investor Seeking Advice for First Deal

[Account Closed]

Hi all, 

I'm currently new to Philadelphia and I'm looking to start my first deal. I'm hoping to receive some advice as I am not only new to the Philadelphia market, but also real estate investing.  I'm very passionate about real estate investing and now I'd like to start taking the steps to acquire my first property.   

A little back ground on my current situation. As I've previously mentioned, I'm new to Philadelphia (2 months) and currently rent an apartment in the city. This would be my first purchase, as I've always rented. Since I'm new to the area Id like to rent for another year or so until I'm ready to buy a home I will live in. 

I'm primarily interested in buy and hold and generating cash flow, however I’m also considering fix and flip. Would anyone have input on pros and cons of each in the current Philly market? Cost/financing advantages? Added costs associated using contractors for fixes and or the challenges of filling vacancies with rental?
 

Further, I’m seeking any direction on zip codes/areas in Philadelphia where people are having success. Areas that are on the rise. Through my research I’ve seen Fishtown and the Brewerytown to be popular. Would anyone recommend exploring further out into the suburbs?

Lastly, I'd greatly appreciate any information regarding financing a first deal. FHA would be optimal, however I don't know that I would be living in the unit (ie. duplex). For a first time deal in a property I would not be occupying , what would be the best suggested way to finance? I'd obviously like to tie up the least amount of capital as possible.

Thank you all for your suggestions, I greatly appreciate any insight you can provide! I look forward to joining this BP community and hope to network with you all! 

[Perry Farella]

Alex,

You can buy a single family home to buy/hold on a 30 year term mortgage with 15% down. Rates are at todays rates based on your credit score, no higher than perhaps 5.75%. You get the low payment of a 30 year term without the worry of having to find financing out of Hard Money after a year. hard money guys may charge up to 35 of loan size in fees and up to 12% in annual interest. True there may no down payment but that 3% is wasted money in some context. Hard Money is great for short term needs but it gets expensive. It has its place of course but be carful not to over extend your self.