The Philadelphia residential real estate market is presently the 3rd best buyer’s market in the United States of America in which listed real estate on average is selling for approximately 5% below its asking price. Philadelphia is truly a city of neighborhoods and from a real estate investment standpoint, each neighborhood has its own particular risk adjusted rate of return.
To simplify, one can class neighborhoods and residential real estate classes in terms of being low income housing, working class housing, and mid income housing. Within mid income housing you have 3 gradients – low mid, mid-mid and high mid. After mid income housing there is luxury housing, which only the truly rich can afford. Purchase prices for rental units in the low income, working class and low mid income neighbors range from $55,000-$100,000 per unit (N20 million to N36million) and deliver returns on investment between 8%-10% per annum on cash invested.
A typical 3 BR row home in a low-income neighborhood that sells for $60,000 and rents for about $800 per month ($9,600per annum)
A kitchen within a typical 3 BR house in a working-class neighborhood that sells for $72,000 and rents for $850 per month ($10,200 per annum)
Estate Links’ USA office has brokerage, property management, general contracting and asset management capabilities and can deliver fully leased rental units / properties to investors completely renovated with a one-year warranty and deliver annual returns consistent with the type of neighborhood one chooses to invest in. Interested investors may state how much cash they would like to invest, how they wish to diversify their portfolio (x percent of units in low income, x percent in working class, x percent in stable mid income neighborhoods) and Estate Links, USA would then put a package together that reflects the investor’s percent neighborhood allocation targets.
Estate Links, USA also offers arrangements for those interested in investing in USA real estate long term in which use can form a real estate investment firm for the investor that would be a US legal entity operated by our firm and would develop debt and credit capacity as an ongoing business concern. Under this arrangement, investors can also do flips (buy, renovate and sell for immediate profit) and take loans collateralized with the borrower’s real estate assets.