All Forum Posts by: Lucas Pfaff

I'd agree with 10+ years Matt. I was just answering the *best case* question :)

@Richard Fields Thanks for the explanation. I completely misunderstood your first break down. The second makes perfect sense.

@Michael Olesky Hey Michael, your point about time better spent elsewhere is very true and something I seemingly forgot. Thanks for bringing my attention to it. 

Best case scenario? Good question! I purchase with clear title and no violations or liens. My expenses run ~$500 for acquisition with an annual insurance premium of $255 + tax. Holding the property as-is, the area appreciates as the crime diffuses over the next 5-yrs and I sell it for $20-$30,000. Purely speculative based on a perspective similar to what @Matt Roberts alluded to.

 HAHAHA! This is dark but it gave me a great laugh! 

 I love this advice David. Thanks for it. This is exactly what I am in the process of doing now that I have a better understanding of the risks.

Thanks for the input Paulette. I've walked the neighborhood and you're absolutely right. Even in the worst areas there are those who maintain their pride. I will stop back and see what else I can learn.

@Jason Bott & @Ed W. - Your points about liability and insurance are not taken lightly. I'm waiting on a quote from my insurer for this property under its own policy (more expensive) or as an addition to my existing policy (less expensive).

@Matt Roberts - The property is in Kensington near Front St and E St. It's a very rough area and at this point in time I have no interest in managing a rehab OR tenant in that area beyond making sure the property is secure and not falling down.

@Richard Fields - Thanks for the calculation...Are you certain of that math? Maybe I'm just doing it wrong, but it looks too low. Assessed value is $22,200. Based on your math the transfer tax would be $8.88 (22,200x0.01x0.04). My guess is that the transfer tax would actually just be 4% of the assessed value ($222). 

 Hey Ethan - The property has been cited in the past and all violations have been addressed. You're point about the area not turning around is my biggest worry right now. This is definitely highly speculative. BTW, the property will be conveyed with clear tile. 

 I've gotten some additional info and there are no back taxes, liens, or asbestos. The property will be conveyed with a clean title. It is DEFINITELY a crap neighborhood where few will want to live. You're right about nothing worthwhile being free...

I have been offered a free property ($1) in a very rough part of Philadelphia. The property is a boarded up shell. I'm trying to figure out what risks I run if I purchase this and sit on it for the foreseeable future.

Aside from yearly RE taxes and HI there shouldn't be any costs I believe?

@Ryan Igbanol Maybe post some details of 2-3 properties that she torpedoed and see what the feedback is. If feedback from BP'ers matches your mentor's feedback, then perhaps it's just a matter of finding better deals and asking the right questions (of your mentor) to understand what's missing. On the other hand, if BP'ers feel there is opportunity with some of your deals, it could be time to cut ties.