All Forum Posts by: Mike Girard

 Undoubtedly that's true generally, but not in my case. It's Nationwide and they haven't been accommodating. They're issuing ultimatums and threats and my agent, Terrance Gannon -- here in Philadelphia -- the least professional person I've ever done business with, ignored my emails and phone calls until I finally complained to his district manager. The company seems rife with unprofessionalism and incompetence. It takes weeks to get a simple answer to a simple question. Considering that they're among the mid-tier companies, I shudder at what Allstate and State Farm must be like. I will never do business with Nationwide again. 

Allstate, by the way, has tentatively offered a very reasonably priced policy, and since I'm using the agent who insured the person that sold this property to me, I have a good chance of getting in. But Allstate...I dunno. Surely the worst reputation of all the big carriers. 

It seems very clear now. I just wondered if there was risk that I might be overlooking, such as other regulations the insurer was immune to. It's all irrelevant now. After someone above said Builder's Risk is for vacant properties, I contacted the agent and she had, in fact, been under the misapprehension that I was not living on the property, even though I'm quite sure I told her otherwise. Whatever the case, she withdrew her bid. 

As for the Erie homeowner's policy, I am not confident I'm going to pass inspection, but at least they do the inspection before they sell you a policy. At the very least, I'll find out what I need to do to get a policy with an insurer that not everyone hates. 

So the question is, how do you insure a fixer upper that needs a very large amount of renovation that you are also living in? 

 Yeah. I'm not put off by the expense. But I didn't want to release that much cash and get the same result I got from Nationwide. 

 Was it homeowner's insurance or something else? I did find one agent who gave me a bid for an Erie policy, but it was very expensive, and after my experience with Nationwide, I'm afraid of another company signing me up and then canceling two months later. But if you're confident Erie won't do that, I'll continue to pursue it. 

 That you had mentioned Erie in another thread stuck in my mind. However, the agent that made this proposal sold Erie as well. She felt Erie wouldn't insure my property in its current state. I don't know what the big problem is with this house. It looks horrible but the renovations are the usual fare: kitchens, bathrooms, patching, painting. The roof, heating, electrical and plumbing all seem fine. 

The agent that provided the quote to me knows I'll be living here.

Whatever it is, I'd like to know if the qualifying language about transacting business in Pennsylvania is a problem.  

I am considering a Builder's Risk policy that my agent has secured through Tapco, a company in Long Island. The policy will be underwritten by Lloyd's of London. 

At the top of the quote it says this:

"The insurer with whom this insurance is to be place is not admitted to transact business in the Commonwealth and is subject to limited regulation by the department; and, in the event of insolvency of the insurer, losses will not be paid by the Pennsylvania Property and Casualty Insurance Guaranty Association"

Does this ring any alarms? I will have this insurance for at least three months but no more than six months while I complete my renovations. 

Also, can anyone recommend an agent, preferably in Philadelphia, that sells  Builder's Risk policies for renovating a fixer upper that I'm living in? 

Welcome Peter.

A caveat: I'm new to this myself having just bought my first property in Philadelphia. I'm a New Yorker and moved here a month ago, but I feel I got to know some areas pretty well through my house search. I was also considering just being a passive out of state investor. 

As to the question of where to buy, I second the endorsement for South Philly close to Broad. The deals are better on the west side but the neighborhoods are more of a mixed bag. Very much a block by block situation as described above. I'm bullish on this area mostly because I think it's such a great neighborhood myself, and just expect people to realize that as prices push them farther south. That said, I'm a little daunted by the successive, seemingly eternal 'For rent' signs on some of my neighbors  houses.  

I think Port Richmond is another good spot for buy and hold investing. The property value won't appreciate as fast as some other areas, but the buy in prices are reasonable and it's a pretty safe, stable area.  It's less block by block than South Philly. The area from Aramingo to the river is safe. I haven't made an exhaustive study, but I think you could get solid returns there and its adjacent to Fishtown, where people are getting priced out. 

For speculative buying, Brewerytown seems like a good bet especially if you find a deal along Girard Ave. 

As to investing remotely, all the cities you mentioned have plentiful offerings through turnkey companies. The site Hipster Investments aggregates deals from different companies. They like Chicago a lot, but feature several offerings in Philly and Indianapolis. The prices seem competitive and you don't have to worry as much about the quality of the neighborhood because when you buy from a turnkey company you also buy a management company. 

To get a feel for an area without visiting it, I find the maps on Trulia really useful regarding crime, commuting times and area businesses. 

I'm probably way to new to this to be offering this much advice and welcome corrections from more seasoned investors. 

 They knew it was brick from Day 1 and the agent who wrote the policy lives in Philly and knows what these row houses are like. No doubt he insures such houses all the time. Whatever the newly discovered "features" are that raise the value above the original assessment, they don't include brick. That they're doing this entirely without an open line of communication apart from a receptionist who freely admits she knows nothing, leaves me disinclined to assume that there's a good reason for it apart from end-of-year ledger balancing. 

Like you and others have said, this doesn't bode well for future engagements, so starting Monday, I will be shopping for another insurer. 

 Yeah, you're probably right. I just hate doing things over and I just think insurance is a racket anyway. But some rackets are worse than others. I wonder if it's just my local office that's screwed up.