Pittsburgh Real Estate: The Market in 2018

Those looking to make a savvy investment may want to look towards Pittsburgh. George Hackett, president of Coldwell Banker Real Estate Services in Pittsburgh, remarks that home sales have been “extraordinary” for 2018, citing a ten percent increase in home sale closings over the past year.

Pittsburgh, Pennsylvania isn’t the most booming market in the United States. It’s currently rated as the twenty-second most populous city in the country, but that can be seen as a positive given the long-term history of the city. The collapse of the city’s reputation as the steel manufacturing capital of the country presaged a nosedive for Pittsburgh’s economy, but today it’s seen as undergoing something of a renaissance.

Pittsburgh has been drawing in national tech companies like Uber and Apple, and with that comes both an influx of new residents and a higher standard of living. The sudden growth of industry in the city brings with it new investments in luxury boutiques and an aggressive push to make more appealing and livable spaces in the once-floundering metropolis.

Further bolstering this economic boom is a new initiative by the University of Pittsburgh Medical Center. They’ve recently announced plans to build a $200 million immunology center that could draw in scientists and medical professionals from around the world.

And while it’s easy to speak in anecdotes about a city’s health, these particular anecdotes come backed by some respectable numbers. Home prices have increased on average by almost eleven percent in the past year, putting the new median home price at $142,800. While that’s a significant increase, it still puts pricing well below the national median of $216,700. That leaves prospective homeowners in a promising position.

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I originally discussed this topic on my blog at JasonCohenPittsburgh.com.

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Will Pittsburgh be Home for Amazon HQ2?

Jason Cohen is a Pittsburgh-based real estate investor with over a decade of experience in his field. Cohen firmly believes in the value of research prior to investment, and took a considerable amount of time to research the risk and rewards inherent in the Amazon deal. Below, Jason Cohen outlines his findings.

How far would your home city go to attract Amazon’s attention? In August, the tech giant announced its intention to build a second headquarters in North America, prompting a deluge of enticements and bargains – some tinged with more than a little desperation. One tiny city in Georgia even went so far as to offer to change its name to Amazon if it was chosen. Bargains like these seem absurd, but it’s easy enough to see why prospective HQ2 cities would go to such lengths to attract attention. The tech giant promises to invest $5 billion in its satellite facility, and bring with it over 5,000 high-paying jobs. As Steve Glickman, cofounder and executive director of the Economic Innovation Group, puts it in an article for CNNMoney, winning the bid for HQ2 is akin to “winning the lottery […] [it’s] an event you can’t duplicate any other way.” With over 230 cities vying for placement, catching Amazon’s interest is a long shot – but some economic analysts think that Pittsburgh, PA has a solid chance of being the company’s next home.

Currently, Pittsburgh ranks in the #5 spot in Moody Analytics‘ list of top contenders. The Forbes-recognized analytical firm took factors such as business environment, available human capital, transportation availability, quality of life, and the cost of doing business when making their considerations. According to their report, Amazon’s ideal satellite site would offer a bargain tax package and affordable land, as well as a supply of workers and the means to support them via transportation and housing. Pittsburgh itself stands above its competition as an already-burgeoning tech hub and thriving city center. It also has the advantage of being within several Amazon executives’ home state;CFO Brian Olavsky, for example, is from Hershey, PA. The city declared its candidacy as many cities did: via a cheery video offering Amazon a home within its borders.

Given the immense potential investment and promise for unheard-of levels of economic growth, every city wants to snag Amazon’s HQ2.  But as a whole, real estate investment advisors within Jason Cohen Pittsburgh are hesitant to leap onto the pro-Amazon wagon. In the promise of incipient wealth, many cities have overlooked the glaring problems that will accompany the company’s second site. For a glimpse of what might come if Amazon sets its roots in Pittsburgh, one only has to look to California. On the west coast, tech companies have sparked massive growth in city economies – and dramatic housing shortages. Affordable apartments are hard to come by in cities like LA, where a 2-bedroom apartment can cost over $4,000 per month in rent, nearly twice the national average. Even the best deals come with a catch – and Amazon’s too-good-to-be-true promise of  investment is no exception.

Amazon hasn’t chosen a location for its second home yet, and its deliberations have become a constant topic of speculation. But perhaps the question should be turned on its head; rather than asking, “What city will Amazon choose,” we should wonder “Will our city accept Amazon?” In the glitz and glam of potential growth, cities have forgotten the high housing cost the company will unwittingly place on Pittsburgh’s current citizens. Amazon’s deal is built with fool’s gold – and those at Jason Cohen Pittsburgh urge those in the city to consider the risks before leaping at its potential rewards.

The Value of Research: A Pittsburgh Case Study

Jason Cohen was only two years out of college when he bought his first property in Pittsburgh. It wasn’t a luxurious place by any means, but it was what he could afford with the means left to him after student loans. He sunk what resources he had into performing the most necessary repairs and managed to breathe new life into the struggling building. Its value soared; newly determined after his success, Cohen set his eyes on the next project and invested his profits. After ten years of hard work, Jason owns commercial and residential properties throughout Pittsburgh. He began with limited means, but Jason now has the resources and experience to run multi-million dollar community projects.

His secret?  Research.

According to Cohen, who facilitates the real estate investment forum Jason Cohen Pittsburgh in his free time, research is the factor that makes or breaks a real estate venture. An enormous amount of pre-planning goes into rehabilitating a property for sale, and the success of the venture hinges on having reasonable profit and cost projections.

More and more investors are flocking to house flipping to make a profit; according to statistics provided by Trulia, a full 6% of homes bought in 2016 had been renovated for sale. However, the field does pose significant risks if investors have little experience. If you intend to break into the real estate industry as Jason Cohen did, please consider the following basic tips for real estate research.

Look into the expense of the house.

Houses cost money. Repairs cost money. As Mindy Jenson, community manager for Bigger Pockets commented for a U.S. News article: “Nobody is going to hand you a house for free, and you can’t go to Home Depot and [get] your supplies for free […] If you are using credit cards and have no money, you can get into trouble quickly.” Assess whether the house will require expensive repairs, and compare your expense projections to your budget. Sometimes, it’s best to be patient and move on from a house with too many liabilities in search for one that poses less of a risk.

Research the neighborhood.

Find out how much you’ll need to pay to renovate the house for sale, then assess how much you’ll likely get for it based on neighborhood averages. Remember, you can’t tack on an extra $10,000 to the price simply because you owe that much to your lenders. Figure out if you can afford to buy and renovate the home, then act accordingly.

Research lenders.

Financing a house is notoriously expensive. Spend time going over your borrowing options, and choose one that suits your needs. Don’t move forward with the first place you visit; take the time to check out all of your lending options and proceed as seems best.

*Originally posted on JasonCohenPittsburgh.org

Jason Cohen Pittsburgh Presents – How to Revitalize a Property Without Breaking the Bank

The house at the far end of the boulevard looks like a place neighborhood kids dare each other to sneak into after dark. With peeling paint and gutters that seem to wilt off the house, it’s an unattractive buy at best. But buy it you did – and you know that it has far more potential than its creaky porch would suggest. The walls may need repainting, and the carpets replacing, but that work won’t take long. You’ve watched every episode of House Hunters; you know how house flipping works.

 

But as your time and money drain away, you begin to wonder, uneasy: Did you make an enormous miscalculation?

 

Renovating houses for sale is all the rage on reality television. Dirt-cheap fixer-uppers turn with seeming ease into beautifully expensive homes on-screen, and audiences wonder if they can turn the same profit as their favorite on-screen stars. Unfortunately, the numbers are against aspiring home-flippers. When Jason Cohen of Jason Cohen Pittsburgh strategizes, he always reminds his advisees that 12% of flipped homes sell at a breakeven or loss price even before calculating for expenses.

 

There’s no getting around it: renovating houses for sale is an expensive and risky venture for those with limited experience. However, Jason Cohen believes that if you are determined to give the investment your best effort, you should consider the following to make the most of your budget.

 

Estimate your expenses before the initial buy

Odds are, the house described at the top of this post wasn’t a lucrative investment. For all the buyer knows, those creaky floors don’t just need a new carpet – they need floorboards and rugs to boot. The curling wallpaper dismissed as a cosmetic fix could, when pulled back, conceal years of structural water damage. All told, the cost of rehabilitating the house added to the initial expense of the house could far outweigh any profit the investor makes after the sale.

 

Be thoughtful! Inspect the house and make a note of any repairs that need to be finished before the sale. Then, consider the market. How much do houses in the area sell for? Can you expect to reach that number? Pricing out your expected costs against your expected gains before buying will help you make an informed decision and prevent enormous financial miscalculations like the one outlined above.

 

Prioritize your repairs.

The unfashionable wall molding in the bedroom might need replacing, but the broken floorboard in the living room takes priority. Resolve the repairs that need to be completed to provide future owners with a livable space; then, if you have the money and time for it, resolve any remaining cosmetic issues. Hopping from problem to problem without any sense of order will waste your valuable time and resources.

 

Find a reliable contractor.

Make sure that you put in the time to check out potential contractors. It may seem a small step at the time, but it saves you considerable time and money down the road. Think of it this way: If you hire a hack contractor and end up firing him for poor work, you’ll need to hire a new contractor to both finish the job and clean up the mess his predecessor made. Save time and money by finding a competent contractor.

 

However, if you happen to be handy with power tools and know how to perform basic fixes well, you should invest the time in doing the work you can complete independently. Taking on a portion of the work yourself will lessen the burden of contractor costs and make your venture more financially feasible.

 

For more information and further advice, reach out to Jason Cohen directly at JasonCohenPittsburgh.com.

 

*Originally posted on JasonCohenPittsburgh.net