Pittsburgh has emerged as one of the hottest real estate investment markets in recent years. With its revitalized downtown, thriving tech and healthcare sectors, and affordable housing prices compared to other major cities, Pittsburgh offers savvy investors ample opportunities. However, navigating the local property market can be tricky. Here are some tips on how to find and evaluate the best investment properties in Pittsburgh.
Look for up-and-coming neighborhoods
Instead of only looking at established areas like Shadyside and Squirrel Hill, also consider emerging neighborhoods. For example, Lawrenceville and East Liberty have seen major revitalization and population growth recently. Buying investment property early in gentrifying areas can lead to significant price appreciation down the road.
Focus on cash flow
While Pittsburgh property values have been rising, prices are still relatively low compared to other cities. This allows investors to find properties that generate strong ongoing cash flow, even if appreciation is modest. Optimize cash flow by looking for multi-family properties or single-family homes that would rent well to students and young professionals.
Be aware of local universities
The major universities like Pitt and Carnegie Mellon drive rental demand in nearby neighborhoods. Properties near campuses can earn high rents during the school year, though cash flow may dip during summer breaks. Investors should factor the academic calendar into financial projections.
Evaluate crime rates carefully
Although Pittsburgh’s overall crime rate has dropped considerably, some neighborhoods still see higher crime. Check detailed crime maps before investing, as excessive crime will deter renters and hamper appreciation. Also, consider whether an area is stable or could potentially improve if targeted for redevelopment.
Factor in taxes
Property taxes vary widely across Allegheny County, so crunch the numbers carefully. Areas like the North Hills tend to have higher taxes, while places like Braddock have lower taxes but higher crime. Finding the right balance between taxes, crime rates, and rental demand is key.
The best investment properties in Pittsburgh offer cash flow and upside in improving areas, while avoiding excessive taxes and crime. Check multiple metrics carefully to find hidden gems in this expanding market.