Nothing devalues a Philadelphia rental property more than its neighborhood.
While a great renovation will greatly increase your rents and decrease your vacancy; the greatest decider on market price for your rental will be where it sits.
Location is important, that’s no big secret in the real estate world; but does the Philadelphia rental investor have an advantage over rental investors nationally?
Think about this for a moment – Every Philadelphian knows that our city changes from block to block. On one block can sit a multimillion-dollar rental property while two blocks away a duplex can sit with one impossible-to-rent unit and an ongoing eviction on the other.
One landlord is killing it and the other landlord simply isn’t. Philadelphia is unique in that regard. There are few landlord investment markets like ours.
Nationally savvy investing is knowing where to buy next. Buy right before the neighborhood changes and enjoy the upswing. But I’m not talking about buying right as much as creating value where you buy.
The question is: “Why does one block do better in the rental property market than another?”.
The reason might come down to a single, sometimes very easy-to-change thing.
Something as simple as one person who de-litters the street weekly can dramatically change the value of a block. And so can drug dealers working on the corner. One increases the value of the properties and the other decreases it.
Now what if the drug dealers also create litter or the opposite dynamic where a new block cleaner makes the dealers uncomfortable to stop them dealing on that block? How much would that change rental property values?
And once a block shifts in property value it escalates in that direction. One property owner picking up litter leads another homeowner to install window boxes, which gets the next property a better tenant, who looks better enough to encourage even better tenants to move in.
As a property manager, and as a rental property owner myself, I always make it my strategy to create value for the properties I control and Philadelphia also makes that easy with its Philly 311 Program. If you are a Philadelphia landlord and you don’t have that smartphone app – get it now!
The Philly 311 works online and allows you to easily, almost instantly report issues that the city will magically fix. Graffiti, abandoned cars, trash, contractor dumping, potholes, missing street signs, fallen branches, drug dealers, you name it; this app reports it for the city to fix it.
The system allows you to report the issue, the phone app knows the location, you can add photos and track the progress and it even notifies you when it’s been resolved.
You can then track your issue as it is processed, worked on, and completed.
While Philly 311 isn’t perfect, and it’s not uncommon for unfixed things to be marked as fixed that clearly are not; the app alerts you when it’s marked resolved and you can easily re-open it and clarify and even add more photos to show the inaccuracy.
I’ll end this article by saying that Property Management allows me to work with many different types of investors; and I’ve learned that the best, most successful, most profitable investors are those that create value. Not the ones that hope for luck or wait for the markets.