All Forum Posts by: Paulette Midgette

@Manuel Savorelli,

I really like the advice that @Jonathan Twombly gave.  I think the one factor that is often missed by most investors is the partnership.  There are people out that who love the chase and capture, meaning there are those who love looking and acquiring the deals.  They are jazzed by the prospect of rehabbing and flipping or rehabbing and managing.  And then their are those folks, like you, who don't have the time or the inclination for the chase, but still want to participate.  Put these two together and you may have a good working partnership.

Hi@Nicole F.,

Check to determine if the owner has taken out a second mortgage on the property.  A second mortgage is getting a loan using the house as collateral.  This allows the owner to tap into the equity in the house.

Typically the term is used when an owner is getting another loan--in addition their original mortgage that they are currently paying--again using the house as collateral.  But the term can apply when the home is owned free and clear.

Many times people who think they are getting a house clear of a mortgage find out after the fact that their is a home equity loan that needs to be paid.

Again, we here can't say this enough--do your own independent research.  Verify every piece of information the owner is giving you.  This will be somewhat time consuming but in the end it will be worth it.

Hi @Nicole F.,

To piggyback off the sound advice from @Rafael Floresta.  Tax delinquent sales are completed through the Philadelphia Sheriff's office and falls under the Sheriff's real estate program.  There are free seminars each month conducted by the Sheriff's office that will give you the ins and outs of Sheriff's sales.  There is also video version of the seminar on the Sheriff's website, but I find that the video does not work most of the time.

At any time before the Sheriff sale you can approach the owner in an attempt to purchase the property.  I would caution you here, if the owner isn't paying his RE taxes, what else is he not paying.  Keep in mind utilities, such as water is lienable in Philly and would need to be paid upon taking possession of the property.  Ensure that you have carefully searched the title.  And lastly, the property could be suggest to a mortgage. 

Yep @Aaron Montague, it is a fact that the city of Philadelphia charges landlords for trash pickup.  This went into effect in 2010, so we here in Philly are well aware.  Seems unfair, since we pay property taxes which includes trash pick up...can't fight City Hall. 

Hi @Sam Desai,

With your price point for purchase there are a number of neighborhoods that may want to consider.  If you are looking for homes with no or little repair stay in the areas in and around Center City Philadelphia (Fishtown, Bella Vista, University City, etc.).  With respect to established neighborhoods, these would be further out from the City Center (Mt. Airy, Overbrook, Northeast Philly, to name a few).

I am not sure what governmental website you got the tax information from, but the Philadelphia percentage may be a comparison to the national average.  Philadelphia real estate taxes are very low, making it a very attractive market for out-of-state investors.

Hi @Mark Cairns

In order to get the name tags to work

hit and hold shift key>type @?>choose from the list of names below the reply box.

@Jayagowri Deenadayalan

I have never heard of owning more than one piece of real estate affecting your credit score in a negative way.  At one point in my investing life I owned 3 properties (all mortgaged) at one time, one property I owned with a partner and my credit was not negatively affected.  During this time I was looking to buy a forth property but didn't do the deal because I was pushing my debit ration beyond what I was comfortable with, but the bank wasn't telling me 'no' on lending me the money. 

Something doesn't ring true with this HML.

Hi @Nicole F.

I didn't run the numbers on the properties you provided but I took a higher level view and here is what I saw.

1.  The comps for like properties in the area you are looking (19139 and 19143 zips on the edge or just inside University City), are selling on average in the high 200k to low-mid 300k.  So I would say this listing is over priced.

2.  I found a like property listing at 415K with a recent price drop of 35k.  Clear indication that this asking prices here are too high.

3.  The taxes on the first property you listed is $3,576 per year. 

4.  If you put your search in the 49th or 50th address numbers you will find many properties below 200k but still close enough to University City to take advantage of what is going  on in that area.

5.  The average rent for like properties  is $1225 per month.

My first investment buy and hold was a triplex at 49th and Walnut street in the 19139 zip.  So, I know the area well.  Crime will happen in a major city or any city for that matter, there is no avoiding that, but the type of crime is what you should focus on when assessing the area. 

I would suggest that before viewing additional properties, that you take time to determine what your short-term and long-term goals are with respect to purchasing a property.  If you can't qualify for a mortgage at this time you may want to try the route of looking for a partnership to help you buy.  Figure out if you are set on living in West Philly, will another part of the city with a lower price point do.  You will need to factor in the rent you collect and the expenses that will need to be covered by the rent.  Will you have enough net from the rent you collect to help cover your mortgage.

I would be more than willing to share with what I have learned and give you some things to concern that you may not have thought about before jumping into your first purchase.  Please feel free to send a message to my inbox at any time.

Good Luck.

Hello,@Michael Donatucci

I agree with @Irfan Raza about the possible cause of the moisture in the basement.  I am willing to bet that the stucco is covering a brick exterior.  The owner probably did not want to spend the money to point the bricks (very expensive here in Philly) and went with the cheaper option of stucco.  Because of the soil and the subterranean feature of Philadelphia basements you will always have some moisture in the basement.  If you are not getting puddles or free flowing water, having a little moisture may not be of major concern. However @Irfan Raza I don't understand the need for French drains or a sump pump.  There are very very few areas in flood zones in the city.  When on the rare occasion some flooding has occurred within the city it was a result of a major rain event (i.e., Hurricane).

Lastly, I would recommend always getting a home inspection.  Especially in the "hot " areas of Philadelphia.  I have seen investors rush into a hot area to get their hands on the deal without knowing the history of the neighborhood or the house.  Deals in the hot neighborhoods are usually not the best deals.  The purchase price is typically way to high for the condition of the property and without a good home inspection (which will run you around $600) dollars you can't spot all the hidden problems that you are sure to find with homes that are 80 years old and upward.

From One Philadelphia Girl to the next, Welcome @Essie Dodson.  Have you head about the Jumpstart Germantown initiative?  This may present some opportunities for you.