What investors should study before buying in Pittsburgh

Pittsburgh can be a strong investment market, but it is not a place to buy blindly because a house looks cheap. Trust me, I was also tempted to buy the $99k historical Tudor in McKeesport, but once I arrived and drove out beyond city limits and saw what that actually entailed, I was relieved I had waited. There are areas of Pittsburgh that may never seen revitalization and you need a local Pittsburgh realtor to help you differentiate.

Yes, the affordability in Pittsburgh is real compared with many major metros. The access is real too. Pittsburgh has health care, higher education, sports, arts, technology, and strong neighborhood identity. But every property still needs careful review.

For investment buyers, I would start with five things.

Local rent demand

Do not assume every neighborhood has the same tenant pool. A property near a university, hospital, bus line, or business district may rent differently than one tucked into a harder-to-reach hillside.

Look at actual comparable rentals, not wishful numbers.

Condition of older homes

Pittsburgh has beautiful housing stock, but old homes can come with old-home problems. For example, some of the URA listing you will find online are super enticing. There is one I continue to show on Perrysville Ave that is $80k. It is a beautiful three story brick building with so many architectural details. How could one not turn a profit on such a building? One tour and some quick math will solve that puzzle for you, but pictures online do not paint a complete picture.

*As a sidenote- my husband and I saved a lot of properties on Perrysville Avenue because it is on the cusp of the Northside with close proximity to great museums and restuarants but be careful. This area has a long way to go and it is just .5 mile too far away.

When assessing potential investment properties you will need a local Pittsburgh realtor and their trustworthy inspector to pay close inspection to the following:

• Foundations

• Roof age (please get a drone or have your inspector get on the roof)

• Knob-and-tube wiring

• Sewer lines (a scope can cost between $200-400 and is NON-NEGOTIABLE)

• Retaining walls

• Moisture issues

• Old windows

• Steep steps

• Shared walls

• Parking limitations

  
  

A low purchase price can disappear quickly if the house needs major systems.

Taxes and insurance

Allegheny County property taxes vary by municipality and school district. Do not estimate casually. A property that looks affordable on price may carry higher monthly costs than expected. Do not stress about calculating these mortgage payments and taxes. I will connect you with a mortgage broker the can make this very easy for you.

Insurance can also vary based on age, condition, slope, retaining walls, and rental use.

Run the full monthly numbers before making an offer. If you are an investor this is obvious to you. I am only speaking to my new investor friends!

Block-by-block change

Some Pittsburgh areas are clearly established. Others are changing. Some are seeing new investment street by street.

That can create opportunity, but it also creates risk. If you are buying for appreciation, study what is actually happening nearby. Look for permits, renovations, business openings, infrastructure work, and owner-occupant activity.

Do not rely only on hope. This goes back to Perrysville Ave. It has hardly changed since I moved here years ago and I originally believed it would turn quickly.

Exit strategy

Before you buy, know who the next buyer or renter might be.

Is the property best for a family, student renters, medical professionals, young professionals, short-term guests, or another investor? Each group cares about different things.

A good deal should make sense from more than one angle. If the market softens and you cannot sell, will the numbers make sense if you are renting it? I like to have a multi strategy approach and run numbers conservatively to allow for unforeseen costs.

Now that we have reviewed considerations, lets talk about WHERE local Pittsburgh realtors are speculating may be good neighborhoods for investors.

As always if you need a Pittsburgh Realtor or Relocation Specialist, please feel free to email me, Jessica Rutamu Compass RE as Jessica.Rutamu@compass.com