Help me understand PGH

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Help me understand PGH

Samantha N.
Investor · WY, USA · Member since 2016 · 25 posts · 2 votes

Hi Everyone,

A little about me & my fiance to start this question: 

We are moving to Pittsburgh in the next several months, and he'll be working at Allegheny Hospital. He's primarily interested in a non-stressful commute and we are looking at owner-occupying something that cash flows at least a bit. 

We've lived all over in the last several years: Boston, Chicago, Iowa, Ohio... and soon Pittsburgh. We've always been renters and rented B+ or A apartments.

No matter where we lived we have always ended up paying ~800-1200/mo for an apartment, whether 1 or 2 bedroom.  And we never lived somewhere considered "expensive" for the city we were in at the time. But even in 1 large and 1 very small town in Ohio, it was around the same. 

Now the question: What is UP with Pittsburgh? Except for Shadyside, the rents seem very low compared to other cities I have been even for nice rentals, but there don't seem to be a ton of those. Like, crazy low rents from my frame of reference. 

However, the condos, multi-families and even single family houses that I have stalked on the MLS seem very high priced for what they are offering compared with other cities we have lived in. And especially compared to what rental prices seem to be in the area. To me most of what I have seen on the MLS seems to be very old, not updated and oddly laid out, like row houses that are very tall but insanely skinny with very steep staircases, condos with wallpaper from the 80s and window A/C units, etc. Or WAY too expensive and a crazy level 10 modernized penthouse or townhome. Where's the middle ground?

What's up with the old, non-updated vibe I'm getting from looking into the market? Is it just where I am looking, and I should direct my attention elsewhere? Or maybe what I'm looking for doesn't really exist in the PGH market right now? I guess I'm just looking for a cool, walkable neighborhood that is up and coming but offers some nicer home options with larger size rooms that would just need cosmetic updating, not a ground-up rehab to modernize it. Bonus points if it's an easy commute to Allegheny Hospital. 

Educate me about PGH, BiggerPockets!

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Jeremy Lee
Rental Property Investor · Pittsburgh, PA · Member since 2017 · 41 posts · 20 votes
9y

Hi Samantha,

Welcome to PGH. I think lots of what you are looking at has to deal with the era that these properties have been built in and the types of modernizations that are coming to PGH. Each wave of people moving in had new things built. The first wave was the steel mills and industrial age, this created lots of developments around the same time. After the hospitals got big and tech moved in starting in the mid to late 2000's, this let to a new wave of people moving in and causing more revitalization, hence renovation. Since it is all timeframe dependent, that is why you are seeing the two ends of the spectrum. It also has to deal with the area, Lawrenceville and Bloomfield recently turned over, within the last 5 years. This means that lots of properties are either of the old era, quarters for a different social economic class of people and lots of properties have been redone for the new era, representing a new class of people. This is what you will find in the city, to find that middle ground, you need to go to the suburbs. Most of the city is very old and the buildings remain from that timeframe, anything new was built within the last decade due to the economic cycle of the city.

If you are looking for more middle ground, look to the suburban areas, Wexford, Cranberry and Bethel Park, these areas have developments from the 80s and 90s and do not have the funky layouts that you see. These are really nice areas, but you can find places and houses that rent for a $2000 on the low end.  These are A/A+ areas.

If you go to like Westview, Bellevue and parts of Brighton Heights you could probably get a nicer house for $1200/1100 per month. These are basically B areas, depending which parts you are in. Some are row houses, but you can get a nice free standing house that is in decent condition for this amount. I know someone who recently redid a house near fineview and wanted $1100/mo, not the best area but really nice house.

If you area near allegheny hospital, there are a couple newer townhomes in the north side ($1100/mo) and some nicer homes between milvale and etna, they aren't row houses, rather standalone houses for about ($800/mo).

Again everything is location dependent, and that dictates the type of housing stock you will find, hence the types of apartments available for rent.

If you are looking for a place that needs paint and carpet to buy and rehab, you probably won't find these places in the 'hipster' areas, many of these places are old and need lots to rehab, these would exist in the suburbs with not great margins. Ultimately, it depends on what your goal is, do you want to rent? Or do you want to do a live-in-flip? Let me know your criteria and we will try to help you find a suitable area.

Best of luck,

Jeremy

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  • Jeremy Lee
    Rental Property Investor · Pittsburgh, PA · Member since 2017 · 41 posts · 20 votes
    9y

    Hi Samantha,

    Welcome to PGH. I think lots of what you are looking at has to deal with the era that these properties have been built in and the types of modernizations that are coming to PGH. Each wave of people moving in had new things built. The first wave was the steel mills and industrial age, this created lots of developments around the same time. After the hospitals got big and tech moved in starting in the mid to late 2000's, this let to a new wave of people moving in and causing more revitalization, hence renovation. Since it is all timeframe dependent, that is why you are seeing the two ends of the spectrum. It also has to deal with the area, Lawrenceville and Bloomfield recently turned over, within the last 5 years. This means that lots of properties are either of the old era, quarters for a different social economic class of people and lots of properties have been redone for the new era, representing a new class of people. This is what you will find in the city, to find that middle ground, you need to go to the suburbs. Most of the city is very old and the buildings remain from that timeframe, anything new was built within the last decade due to the economic cycle of the city.

    If you are looking for more middle ground, look to the suburban areas, Wexford, Cranberry and Bethel Park, these areas have developments from the 80s and 90s and do not have the funky layouts that you see. These are really nice areas, but you can find places and houses that rent for a $2000 on the low end.  These are A/A+ areas.

    If you go to like Westview, Bellevue and parts of Brighton Heights you could probably get a nicer house for $1200/1100 per month. These are basically B areas, depending which parts you are in. Some are row houses, but you can get a nice free standing house that is in decent condition for this amount. I know someone who recently redid a house near fineview and wanted $1100/mo, not the best area but really nice house.

    If you area near allegheny hospital, there are a couple newer townhomes in the north side ($1100/mo) and some nicer homes between milvale and etna, they aren't row houses, rather standalone houses for about ($800/mo).

    Again everything is location dependent, and that dictates the type of housing stock you will find, hence the types of apartments available for rent.

    If you are looking for a place that needs paint and carpet to buy and rehab, you probably won't find these places in the 'hipster' areas, many of these places are old and need lots to rehab, these would exist in the suburbs with not great margins. Ultimately, it depends on what your goal is, do you want to rent? Or do you want to do a live-in-flip? Let me know your criteria and we will try to help you find a suitable area.

    Best of luck,

    Jeremy

    2Reply
  • Samantha N.
    OP
    Investor · WY, USA · Member since 2016 · 25 posts · 2 votes
    9y

    Thanks so much for your reply!

    We were thinking of getting a small multifamily, doing a BRRR, but not any major layout overhauling, wall moving, or hardcore plumbing work. But our plans may change as we explore the area. It may not exist and that's okay.

    This does really seem to make sense for why things look the way they do. Now we kind of just have to figure out how to profit from how things are right now. 

    0Reply
  • Alex Deacon
    Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
    9y

    @Samantha N. Look me up when you are ready. We manage over 650 units in Pittsburgh. We may have something for you for sale but that changes monthly so I would need to know when exactly you want to start looking. I would suggest a duplex in a B area. A areas will be too costly and not cash flow. You will be paying for the area and although it will appreciate steadily you also want a property that will cash flow when you move and rent both sides.

    0Reply
  • Samantha N.
    OP
    Investor · WY, USA · Member since 2016 · 25 posts · 2 votes
    9y

    @Alex Deacon I absolutely will look you up when the time comes, thank you!

    0Reply
  • Jeremy Lee
    Rental Property Investor · Pittsburgh, PA · Member since 2017 · 41 posts · 20 votes
    9y

    You can probably find a place in some of the nicer areas that doesn't need to much work, force appreciate it a little bit and if you hang on to it for a while there might be some appreciate for you. I think a duplex or a triplex would work well for you, it will still cashflow, you will have a place to live and you can force appreciate it. Also if you install tenants and prove that they pay, sell it to a turn key place for a premium. 

    @Alex Deacon suggestion is reasonable, he also has a monthly event where you can pick up nuggets of information. He will try to sell you on a couple things, but its not a hard sell or anything, a small price to pay for information.

    2Reply
  • Alex Deacon
    Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
    9y

    @Jeremy Lee thanks for the compliment.

    0Reply
  • Anthony Angotti
    Real Estate Agent · Pittsburgh, PA · Member since 2015 · 1k+ posts · 846 votes
    9y

    @Jeremy Lee had some good suggestions there! 

    In the morning 28S is a mess. So I think my suggestion would be with Jeremy 's Bellevue/Brighton Heights/Avalon Idea. 

    Also, a lot of our housing stock is either 100 years old or 60 years old. Most everything that looks updated or trendy is just a prettied up 100 year old house haha! At least that's the case as you get closer to the city and a shorter commute for you. 

    1Reply
  • John Ruffaner
    Member since 2020 · 6 posts · 0 votes
    6y

    South side is for party people if you want quiet stay away from that area also I would not recommend bell view any updates will be held up and the area is not worth the problems look into North fayette corrioplies moon twp creascent twp , swickly is most expensive but you can get a deal if you look hard enough that is where most of the famous people live! Also look at the school district that is how a area is judged in this area anything 7 and up is a grate place to live with higher rental rates they will have older places but that's how you make money around this area is by adding value to the property with updates!

    0Reply
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