The Real (estate)
Deal
Entrepreneur and Realtor Brad Liermann keeps tabs on development here in the borough
Forget the downturn: investing in this town is as active as it’s ever been, and lately, it’s been particularly robust on the small scale. The borough contains hundreds of properties, 450 to be exact, and the prices for these properties typically begin in the mid $200,000 range for properties that need some work. The value often rises in excess of $600,000 for a four-unit property that has been well maintained with a solid rental history. Although each real estate deal is different, at the low end, a two-unit property could be purchased with as little as $12,000 cash on hand, and even less if the purchaser will be living in one of the units in the property. For properties that have four units or less, residential loans can be obtained for their purchase. All of these factors have come together to create the opportunity for someone who wouldn’t consider themselves to be a particularly experienced real estate investor to get into the game. And it’s the perfect time for you to as well. Of course, I’m sure you have many reasons for not wanting to become a landlord, but many of those concerns can be alleviated with the right mindset and planning. The most common objection is a fear of the time-consuming nature of dealing with tenant issues and property repairs. While this is undoubtedly a rational and real concern, a quality property management company can eliminate the issue. For approximately ten percent of monthly rents, a property management company should be able to take care of virtually any problem that may arise. Other concerns include the cost of repairs or renovations, the additional tax owed to the government, and the harm tenants can do to a property. These should all be addressed with a real estate brokerage, but if the financial projections are made conservatively prior to the purchase, and the tenants are adequately screened, you can solve these issues quickly and adeptly. Many multi-unit properties have been bought and sold in West Chester in the past several months, and for record prices. As Chester County grows in population, rent prices have never been higher. With higher rents come higher sales prices for owners, and many are cashing in. This creates an opportunity for a new crop of investors to begin their own process of wealth creation via the real estate market. Not only that, but local ownership is better for the community—when local residents become owners of these rental properties, the properties become more than just numbers on a spreadsheet for a large development company. They are given the attention and care they’ve long needed. The opportunity to invest in something tangible is literally next door. You may just have to knock. bliermann@TheWCPress.com
JULY 2014 THEWCPRESS.COM
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