Flipping in Lancaster means working with old brick: party walls, stone foundations, plaster, slate and decades of patched wiring. The upside is a deep pool of buyers who want renovated city homes within walking distance of downtown.
In short: LendingStreet offers fix and flip loans in Lancaster and across Lancaster County from $150,000 to $5M+ for 1-8 unit investor rehabs. On some programs we finance up to 90% of total cost and up to 100% of the rehab budget, with interest-only payments and closings in as little as 10 days. Exit by selling the home or refinancing into a long-term DSCR loan.
City flips concentrate in the Southeast, Cabbage Hill, the West End and the streets north and east of downtown, where dated rowhomes and twins can be bought below the price of finished homes nearby. Buyers include young professionals, hospital staff and people relocating from larger and more expensive East Coast metros who want a walkable small city.
Outside the city, Columbia, Elizabethtown, Ephrata, Mount Joy and Manheim offer older borough homes, while 1950s to 1970s ranch and split-level homes in Lancaster Township, East Hempfield and Manheim Township attract buyers looking for space and suburban schools.
A flip loan funds part of the purchase at closing and holds the rehab budget for release in draws as each phase is finished and inspected. Payments are interest-only, generally on drawn funds, and the loan is short-term. We underwrite the purchase price, scope of work, after-repair value and your experience. First-time investors can qualify with a solid budget and a capable contractor.
A good Lancaster budget is line by line: demolition, structural and masonry, roof, electrical, plumbing, HVAC, windows, kitchen, baths, floors, paint, exterior and permits, plus a contingency. Old houses reward a generous contingency more than almost any other line, because walls and floors hide problems until they are opened.
Most city rowhomes date from the late 1800s or early 1900s. Expect lath and plaster, old knob-and-tube or patched wiring, galvanized supply lines, clay or cast iron sewer laterals and fieldstone or brick foundations that can let water in. Shared party walls mean roof and gutter work can affect a neighbor, and some roofs are slate or built-up flat roofs that need specialists.
Lead paint is common in older homes. Disturbing painted surfaces in pre-1978 housing requires lead-safe practices and certified renovators, and the time and cost belong in your budget.
This example is illustrative and not a quote. An investor buys a three-bedroom twin for $170,000 with a $90,000 rehab budget, for a total project cost of $260,000. At 90% of cost the loan is $234,000.
The estimated interest-only payment on the full balance is about $2,096 a month, or about $14,674 over a 7-month hold. With purchase closing costs of $6,000, taxes and insurance of $2,310 and utilities of $1,575, the investor's cash in the deal is about $50,559. If the home sells for $345,000, with about $24,150 in commissions, the seller's share of transfer tax and other selling costs, the estimated profit is about $36,291.
| Item | Amount |
|---|---|
| Purchase price | $170,000 |
| Rehab budget | $90,000 |
| Total cost | $260,000 |
| Loan at 90% of cost | $234,000 |
| Estimated interest over 7 months | $14,674 |
| Investor cash in the deal | $50,559 |
| After-repair sale price | $345,000 |
| Selling costs incl. transfer tax share | $24,150 |
| Estimated profit | $36,291 |
Large parts of downtown Lancaster and surrounding blocks are in historic districts where exterior changes visible from the street, such as windows, doors, porches and siding, need review before you start. Interior work generally needs building permits under Pennsylvania's Uniform Construction Code through the city or the municipality's code official.
Find out early whether your property is in a district and what the approval timeline is, and build the review into your schedule. Replacing original windows without approval is a common and expensive mistake.
Many Pennsylvania municipalities require a resale or use-and-occupancy inspection before a property can be transferred, and the City of Lancaster's rental and housing rules may come into play if the house was a rental. Check the requirements for your municipality at the start of the project, so the final inspection does not delay closing with your buyer.
Pennsylvania's realty transfer tax, 1% state plus local shares, applies when you buy and again when you sell. By custom the tax is often split between buyer and seller, so a flipper usually pays a share twice in a short period. Some investors negotiate who pays, but the contract decides. Include both payments in your numbers.
Your after-repair value should come from renovated homes that sold recently on comparable blocks. In Lancaster, a street with owner-occupied, restored rowhomes can sell well above one a few blocks away, so be careful about borrowing a comparable from a stronger street.
Some Lancaster rehabs work better as rentals, particularly twins and small conversions near the hospital or F&M. You can refinance the flip loan into a DSCR loan that qualifies on rent and keep the property. Our Lancaster rate-and-term refinance page explains that payoff.
If you plan to hold, remember that a city rental will need a rental permit and inspection, and that the rent appraiser will look at comparable rentals, not comparable sales. Run both the sale and rental numbers before you choose finishes, since a rental and a resale may call for different levels of spending.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the address, purchase price, rehab budget, comparable sales and your experience through the form below, or call (877) 298-1001. For statewide context, see our Pennsylvania fix and flip loans page.
On some programs, up to 90% of total cost and up to 100% of the rehab budget. Leverage depends on the deal, the after-repair value and your experience.
Yes, with a detailed budget, solid comparable sales and an experienced contractor. Experienced investors often get better leverage.
Not the loan itself, but it affects your timeline and costs. Exterior changes in historic districts need review before work starts.
You finish a phase, an inspector confirms the work and the funds for that phase are released. Interest generally accrues only on drawn funds.
Usually yes. Pennsylvania's realty transfer tax applies to each transfer, and the split between buyer and seller follows the contract.
In as little as 10 days once title, insurance and our property review are complete.
If you disturb painted surfaces in housing built before 1978, federal rules generally require lead-safe work practices by certified renovators.
Yes. Our fix and flip loans cover 1-8 unit residential properties, including small conversions.
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