All Forum Posts by: Paulette Midgette

Hello Wasim and WELCOME to BIGGERPOCKETS. 

I completely understand your self doubts.  I have been there, in fact we all have.  As humans we are hardwired to remove ourselves from things that are unfamiliar and scary. 

But keep in mine fear can be used to your disadvantage-the self doubt that keeps one from pursuing aspirations and dreams, or to your advantage - the fear of being broke for the long-term or missing out on your dreams because you can't obtain financing because of a low credit score.  I hope you see that the advantage is that the fear of not succeeding and continuing the same path to nowhere will often times prompt you to push the self doubt away and do something. 

 This is the process I went through before acquiring my first property.  And if I remain honest, I have to say that each time I  purchase a property I still feel a small pang of fear.  The real estate lessons I have learned, ensuring that I have done my homework, and knowing my business, all help me to push that fear back down to a place where it doesn't keep me up at night.

Stay connected to BP, keep reading, listening, connecting with people.  I assure you your opportunity will come and it will probably come from a place you least expect.  You have a valuable skill that is always needed by homeowners...market this skill.  I have some ideas I would like to share with you about how to market your skills to investors that may lead to a win-win for both that I would like to send via your inbox.  Please let me know if you would be open to this.

Kind regards

Hi Michael,

The interesting thing about Philadelphia is that it is surrounded by suburbs and towns that are easily accessible by car and readily accessible my SEPTA.  While there are a large percentage of jobs in the City, there are also a large percentage of jobs in the suburbs.  Note, 3 of the 4 largest Pharmaceutical Companies (1000s of employees) are less than an hours drive from Philadelphia.  Side note, I live in east Mt. Airy and it takes me 15 minutes to drive to my place of employment at one of these companies.  Therefore, people who live in the city move in and out of it to work.  Jobs should not be a factor in this instance.

I would encourage you to keep an open mind to where to invest in Philadelphia.  Your options are plenty.  If you want to rent to college students the opportunities are there, but the purchase will come at a premium.  If you want to support our lower income residents opportunities can be found here as well and you pay a lot less to purchase. 

I would say, focus in on what type of landlord you want to be, this will help you determine the type of tenant you want to attract; this will help you determine the rental rate you should expect; this will help you determine the area where you should target your purchase.

Hello Franciso,

Let me start by saying that I absolutely love the City of Philadelphia and its surrounding areas.  It is a city full of history, diversity, and culture.  You and your family will never be in want of something to do here.

I have lived in the city of Philadelphia my entire life and have worked in the suburbs most of my adult working life.  All of the flips I have done have been in the suburbs and all my buy and holds have been purchased in the city.  The reason? Simple, the majority of renters (48%)  reside in the city and the vase majority of people in the suburbs own their homes.  That is not to say there aren't renters in the suburbs, because there are, just a lot less of them. In fact there are some pockets in the suburbs were there are a high percentage of renters, such as Norristown, but I don't think this is a good area for investing.  Also, I have noticed that duplexes can be found in the burbs more readily than triplexes or fourplexes.

Philadelphia is a city of neighborhoods.  Neighbors are close, mostly rowhomes and twins.  So, if you are looking for area where your children could make friends in the neighborhood the city  provide this.  With that said the areas of West Mt. Airy and Chestnut Hill have large percentages of large single family homes that are located at distances away from one another...so these may not be good if you have children.  West Mt. Airy, East. Mt. Airy, Center City, Parts of South Philly, Fishtown and more recently Kensington are all areas where single young professional are buying homes.  You will also find many multifamily units in these areas as well.

Below are a few  links to help you learn a little more about the city.  Please feel contact me via my inbox with questions about an area you have identified, purchase price points, or simply an RE reference. I have not found any links like the ones listed below for the burbs, but an internet search on the suburban areas you are interested in will give some information.

http://www.phila.gov/cityplanning/Pages/default.aspx - Click District Plans

http://www.visitphilly.com/philadelphia-neighborhoods/

http://www.ocfrealty.com/naked-philly

@Joe Cumming

First, buy up a block of rowhouses or a multi unit just outside the ghetto making sure it has good public transportation.

Do a quick rehab.

Advertise for rent in the PGN

Joe, where are the ghetto areas?  Are you referring to the Philadelphia County or the surrounding depressed areas in the surrounding suburbs?  I live in Philadelphia (born and raised) and I no of no areas within the Philly limits such as you this ghetto.

Also, why do you suggest advertising in the Philly Gay News?  Why not also advise in the Daily News, Philly News, etc.?

You post if very suggestive and I believe meant to be offensive.  Watch the words you choose!

Hello Huy,

I live in Philadelphia and have owned and sold a number of rental properties.  I won't comment on your math or what financing might be appropriate for you since I see many othesr have already given you some advise on this.

I would like to share with you what you should expect from the Philadelphia rental process.

Firstly, I see that you are interested in purchasing in Center City Philadelphia for about $180k.  At this price point there are very few-you can count on one hand-rental units that can be purchased in Center City.  At this price point you would be looking at a condo around 400 sq. ft. or less.  If this is along the line of what you are thinking, keep in mind that a condo of less than 600 sq. ft. will rent for less than a larger one so you will need to adjust the rental estimates you stated in your message.  Also, you will need to factor in the monthly condo fee that would need to be wrapped into your rental rate.

If you are setting your price point based on a purchase in South Philly-just south of Washington Ave (which is adjacent to Center City proper) then you will be able to find many potential purchases for rentals here. 

In order to rent in Philly you will first need to acquire a Business Privilege license.  One you have this license you can then apply for a rental license.  Depending on the structure of your rental business you may also need to apply for a tax account.  As of 2010 if you own a multifamily unit in Philadelphia you are required to pay for your properties' trash collection.  Note, this is separate from the property tax that you are already paying for this type of service.

For more informantion about your responsibilities as a landlord and the requirementss for residential renting within the county of Philadelphia check out Philly.gov.

Hello From Philadelphia Eli.  Here are my thoughts on the pros and cons to college student rentals vs Section 8 in Philly.

1.  The Pros - Section 8...the rent is guaranteed (or at least the government's portion); Tenants know that Section 8 has a low threshold for noncompliance, so the vast majority pay their portion on time; in Philly it is a relatively simple progress to qualify your home for Section 8; There are a lot of Section 8 seekers in the city so, finding a renter shouldn't be difficult.  The Students...you collect the rent for the entire semester up front (again rent guaranteed); May be able to arrange a side contract with parents to cover any major damage that students cause to the home; During the summer break landlords have the opportunity to make repairs to the home.

2.  The Cons - Damage, folks will cause damage...sometime minor, sometimes major.  Not paying the rent and eviction is another con.  One con specific to student rentals is the high turnover.  Nine times out of 10 your place will be empty during the summer breaks.  If not, the students who rented in the Fall and Winter may not be the same students who rent during the summer.  You will have a lot more move out, move in activity. However, all this is the cost of doing business, so you must have a plan on how you will deal with these issue. 

@Garrett M.

One thing I do to learn about neighborhoods is to check rental costs of properties nearby to properties I am considering. Craigslist, Redfin and Rentometer.com, can provide a good barometer of a neighborhood and help you to know what your investment may yield in rent...

Thanks for the tips, very useful.  I just discovered Rentometer...awesome!  Another good resource for gathering information about the state/city/neighbor one is interested in investing in is http://www.usa.com/.  Here you will find stats on demographics, population, housing values, and gross rent figures, just to name a few.  You can even search down to the zip code of the area you are researching.

Hello All,

I was born and raised in Philly. Spent time going to school, working, living, and hanging out in many areas of the city. I have also invested in different areas of the city (Old City, University City, Mount Airy, and the Northeast).

Philadelphia is an interesting city for RE investing. Real taxes are low and it appears from my research that the cost of doing business (license fees, etc.) is also low comparatively. In addition, about 52% of the population in Philly is homeowners. All, setting the stage for a good and steady rental market.

With respect to up and coming neighborhoods, I would suggest not limiting yourself to any one area. Explore them all as much as possible using online search tools and BP. There are good deals to be had in all areas of the city. Depending on your budget, the type of property you seek, and the type of desired tenants, properties can be had in Philadelphia from as low as $60,000 (well, some even lower than 60 but definitely not in desirable areas) to upwards of a million dollars.

A great resource for learning about Philadelphia neighborhoods is the Philadelphia Planning Commission (see link below). Here you will find district plans outlined (land use, future development opportunities, urban design) for the entire city through 2035. Note each district is made up of a number of individual neighborhoods.

http://www.phila.gov/CityPlanning/plans/Pages/DistrictPlans.aspx

Another great resource for learning about what is going on in Philly neighborhoods is a blog called Naked Philly. Take look you will quickly see what I mean.

http://www.ocfrealty.com/naked-philly

If you have any questions, please feel free to e-mail me.

Good Luck

Hey Steve, finding them, liking them, and using them are all different things.  As you noted not all contractors associated with this organization are good or reputable, and the goods one have more business than they can handle because everyone is trying to get them on their jobs...reason I meantioned them but am still here looking for contractor contacts.

By the response I have gotten to this question, everyone in this area are in the same boat I am or they are keeping their good contracts for themselves.

Thanks Steve. I am a member of the Diversified Investors Group in Philly.  If you are familiar with the group you know that I can find referrals for contractors here as well.  However, I am competing with thousands of DIG members for the good ones.  HAPCO is another avenue I did not consider (yes, I am a landlord) and will look into it.

Paulette