Photo by Daniel Barnes on Unsplash
According to the 2022 Demographia International Housing Affordability survey, Pittsburgh, PA is the most affordable housing market in the world right now.
That’s right. The “Steel City” is the most affordable place to live when you compare its average housing prices, household income, and interest rates to those of other markets.
Overall, US housing affordability has actually tanked in recent years. According to data provider Black Knight, affordability is at its lowest since the early 1980s. Pittsburgh just got hit by this trend the least.
This could lead to an uptick in Pittsburgh housing demand as homebuyers and renters move in from more expensive states. After all, remote work is on the rise and many people are leveraging it to live in more affordable areas—especially with how expensive top metro areas can be.
So whether you want to buy a home in Pittsburgh to live in or just to invest in, now is great time to do it. Either way, you’ll benefit from the city’s relatively affordable market.
Here are a few different investment strategies you can try to take full advantage of Pittsburgh’s affordable housing market:
- Fix and flip
You’ve seen it on dozens of TV shows: investors buying distressed properties, fixing them up, and then flipping them for a profit. The fix-and-flip method can be a great way to earn a quick return on investment.
Though it helps to be a handyman, you don’t have to be one. For example, you could hire a contractor to do a home addition for you. That way, you raise the property’s value and can sell it for more than you bought it for. Just make sure you maintain a sufficient profit margin after accounting for renovation expenses.
- Buy and hold
A more hands-off approach to investing in Pittsburgh real estate is to buy and hold. This means buying a property and holding onto it as its value appreciates over time. The longer you hold, the more you’ll gain.
Since the Pittsburgh housing market is relatively affordable, you may be able to snag a property at a good price. Then if the market ever goes up, you’ll share in some of the growth.
- Rent out
Of course, you can always rent out a Pittsburgh property. Now that it’s the most affordable housing market in the world, there’s bound to be an influx of renters coming in from more expensive markets.
Generally, you have two options when it comes to rental properties: long-term and short-term rentals. Long-term rentals typically have year-long leases that can be renewed each year. Short-term rentals cater to visitors who want to stay for only days at a time (usually for vacation). If you go this route, you can easily list the property on sites like Airbnb or VRBO.
Choose a rental strategy that works best for you, your property, and the neighborhood.
- House Hack
House hacking is a term originally coined by Brandon Turner from BiggerPockets.com. It refers to finding ways to generate income from your primary residence.
For example, you could rent out a spare room, a basement unit, or even storage space in the garage. That way, you’ll earn extra rental income to help offset your mortgage and tap into the full value of your property.
It’s up to you
Whatever strategy you choose, Pittsburgh, PA is a great place to invest. The housing is affordable and the demand is growing. Just remember to thoroughly run the numbers on any potential deal to make sure it works. Any investment can go south if you don’t do your due diligence.
But with the right property and the right strategy, you can start benefiting from Pittsburgh’s affordable real estate market today!