Cash Flowing Areas in Washington State

New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes

Hi Guys!

Just moved to Kent area, Washington in November, new Job, and everything’s going well so far.

Looking to start a conversation specifically about Washington State in regards to hot Cash Flow potential areas in the Multifamily space.

Our plan is to sell my Alaska Home in May-ish, then use that money to invest in likely a Duplex/Triplex. I have been practicing running my numbers, and have been looking at areas like Tacoma.

I should have about 35k after my Alaska Home Sale to invest towards a multifamily, are there any particular areas that any of you have had great success in the multifamily space, resulting in healthy cash flow?

Thanks BP Fam!

-Rupe

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Jake Alger

Real Estate Broker · Bellevue, WA · Member since 2017 · 172 posts · 107 votes

Hi Ryan,

As others have mentioned, try focusing outside of Seattle a bit. Tacoma has some cash-flowing properties but most multi-families in the region have been overpriced the past few years. That doesn’t mean deals can’t be found, but expanding out to other areas north of Seattle or even east will give you more options. I recently did a deal on a fixer duplex in Wenatchee that will rent for a good cash flow. I’d be happy to chat with you further. Feel free to reach out!

- Jake

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Justin Frank
Rental Property Investor · Tacoma, WA · Member since 2018 · 244 posts · 140 votes
7y
@Ryan Rupe look in Thurston County. Great rental market. Thurston County is in a bit of a crisis for homes/apartments available for individuals to rent so if you can find a rental in this area it will be highly unlikely that you will have any vacancy issues. The hard part is going to be finding a good purchase point to cash flow. Washington is very expensive right now and when a good deal comes along it goes very quickly and usually goes to folks who are very well established in the rental investment game. With that that being said, its not impossible to find a good deal, it’s just difficult. Good luck 👍
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Fred Engh
Member since 2018 · 57 posts · 22 votes
7y
I live in Omak.
The good: you can buy a $50k house that rents for $600 - $700 (which is, for the most part, better than western Washington on a cap rate or price/rent ratio). There are not a lot of vacancies.
The bad: higher unemployment. Very small town (5,000 people. 40k in a sprawling county). Harder to price comps so you have to understand differences between properties.
3 Reply
Sam DennyPro Member
Rental Property Investor · Seattle, WA · Member since 2016 · 53 posts · 23 votes
7y
Welcome Ryan! I’ve heard Tacoma has potential to cash flow. I focus an hour north of seattle in the Skagit valley since I grew up there. You still have to be patient but you can find 1% rent to value. There is strong rental demand due to lack of inventory in the area.
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Jake Alger
Real Estate Broker · Bellevue, WA · Member since 2017 · 172 posts · 107 votes
7y
Hi Ryan,
As others have mentioned, try focusing outside of Seattle a bit. Tacoma has some cash-flowing properties but most multi-families in the region have been overpriced the past few years. That doesn’t mean deals can’t be found, but expanding out to other areas north of Seattle or even east will give you more options. I recently did a deal on a fixer duplex in Wenatchee that will rent for a good cash flow. I’d be happy to chat with you further. Feel free to reach out!
- Jake
3 Reply
Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
7y
Originally posted by @Jake Alger:
Hi Ryan,
As others have mentioned, try focusing outside of Seattle a bit. Tacoma has some cash-flowing properties but most multi-families in the region have been overpriced the past few years. That doesn’t mean deals can’t be found, but expanding out to other areas north of Seattle or even east will give you more options. I recently did a deal on a fixer duplex in Wenatchee that will rent for a good cash flow. I’d be happy to chat with you further. Feel free to reach out!
- Jake
Maybe a Skip connection on that Wen duplex? He wouldn't invest in the south I'm sure. Stay out of the South end.
Most are having to go outside the core, into tertiary or rural markets. Even here. I'm more of a seller than buyer at this stage of the MF cycle. I pass on a lot of opportunities. DM me your criteria if you like and I'll keep an eye out.
2 Reply
Christen G.
Rental Property Investor · Seattle, WA · Member since 2017 · 383 posts · 248 votes
7y
Congrats on the move and new gig, Ryan. And it's great that you're looking to invest in Western Wa. Are you wanting to live in the space, or just use it as a rental and want cash flow?
0 Reply
James Cash
Real Estate Broker · Anchorage, AK · Member since 2015 · 170 posts · 46 votes
7y
Sorry we lost you from Alaska!
@Ryan Rupe Are you going to owner occupy? Obviously if yes, that changes the game a bit due to the fact you'll have to (or should) have a comfortable commute.
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Brandon VukelichBusiness Member
Real Estate Broker · Tacoma, WA: 🏢 27 LTRs 🏡 3 STRs · Member since 2018 · 549 posts · 458 votes
7y
@Ryan Rupe some good feedback from the group here. I suppose it depends on what your metric is for "healthy" cashflow. Yes, greater Seattle is super tight. S. King, Tacoma and Pierce Co will have more options. As James mentioned, also depends on whether you plan to owner occupy. $35k will get you into a duplex or maybe triplex with owner occupy financing. I'm happy to send you a link to our local MLS app if you'd like to watch inventory and search at your convenience. I have MF experience in the Seattle-Tacoma market. Happy to help you analyze deals if you need it. Keep in mind there is more to reviewing properties than just the financials. Best wishes on your plan!
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Ruth Bayang
Investor · Kent, WA · Member since 2015 · 624 posts · 274 votes
7y
Welcome @Ryan Rupe
I live in Kent too. Pierce county is great. Also consider Kitsap county and Thurston county, even Lewis county.
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Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Justin Frank great advice man! I will definitely start to do some research into Thurston County and watch listings from that area. Thanks!
0 Reply
Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Fred Engh that's good to know that there are areas out there still that have homes for that price! Is there a particular industry that rules that area or type of work that drives someone to live out there, just looking on the map now
0 Reply
Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Sam DennyThat's cool man, definitely still learning all these new areas as I am new to Washington but checking it out now actually.
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Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Jake Alger I appreciate that Jake, I have definitely came to terms that I won't be looking to purchase a MF near Seattle. But my intention at this point is not live in, (don't think the fiance will go for it haha) but simply to rent out all units for cash flow.
0 Reply
Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Christen G. Thanks dude!! We are happy with how things ended up. I believe we will not be looking to live-in, at this point, but to just rent out all units for cash flow. I need to personally read a few more books but I'd love to execute a BRRRR method on a MF.
0 Reply
Christen G.
Rental Property Investor · Seattle, WA · Member since 2017 · 383 posts · 248 votes
7y
In that case, keep reading and kKeep an eye out in Aberdeen MF, too. I have found a few there. It's not a place I'd personally live and doesn't have a whole lot going on, but I'm finding cash flow there.
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Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@James Cash Haha oh it'll always be Home tho! 27 years or so!
Like I mentioned to a couple others so far, my plan at this point is to not owner occupy, so that opens me up for flexibility on location of my search.
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Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Brandon Vukelich Thank you for that offer Brandon! I don't plan to owner occupy so I am boundless on location. Personally my criteria of healthy is $150-200 CF per unit.
0 Reply
Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Ruth Bayang Awesome Ruth! Thanks for the tips, I'll look into them!
0 Reply
Chauvin Rupley
Bellingham, WA · Member since 2016 · 17 posts · 6 votes
7y
@Ryan Rupe Just wanted to say I’m looking at the same criteria (MF space) annnnd people call me “Rupe” for short! Let’s get this duplex Rupe! 🤘🏽
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Ryan Rupe
OP
New to Real Estate · Federal Way, WA · Member since 2018 · 15 posts · 4 votes
7y
@Chauvin Rupley No Way!! Haha that’s crazy! Small World, Rupe Takeover!
0 Reply
John Dirgo Deweese
Real Estate Broker · Aberdeen, WA · Member since 2015 · 101 posts · 74 votes
7y
Yes, Grays Harbor has some real viable cash-flow positive MF options.
0 Reply
Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
Originally posted by @Fred Engh:

I live in Omak.
The good: you can buy a $50k house that rents for $600 - $700 (which is, for the most part, better than western Washington on a cap rate or price/rent ratio). There are not a lot of vacancies.
The bad: higher unemployment. Very small town (5,000 people. 40k in a sprawling county). Harder to price comps so you have to understand differences between properties.
I was just thinking about mentioning from Canadian border on down the 97 corridor And maybe tri cities as well.. I have flown in to Omak nice airport there ..
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Mark Sewell
Investor · Houston, TX · Member since 2017 · 1k+ posts · 871 votes
7y
I grew up in Kelso (and in fact, I think I went to school with a guy named Rupe..). Anyway, over in Longview there is an area of town that is close to the mills, a couple paper mills and the aluminum plant there along the Columbia River. Serious working class area. That area, or an area like that, might be worth looking at.
0 Reply
Jack B.
Rental Property Investor · Seattle, WA · Member since 2014 · 1k+ posts · 1k+ votes
7y
Originally posted by @Ryan Rupe:

Hi Guys!
Just moved to Kent area, Washington in November, new Job, and everything’s going well so far.
Looking to start a conversation specifically about Washington State in regards to hot Cash Flow potential areas in the Multifamily space.
Our plan is to sell my Alaska Home in May-ish, then use that money to invest in likely a Duplex/Triplex. I have been practicing running my numbers, and have been looking at areas like Tacoma.
I should have about 35k after my Alaska Home Sale to invest towards a multifamily, are there any particular areas that any of you have had great success in the multifamily space, resulting in healthy cash flow?
Thanks BP Fam!
-Rupe
35K is not going to buy you a multi family anywhere near Puget Sound...More like 100K+ is needed. And even at that price you're not going to see a ton of cash flow, you will likely just break even.
1 Reply
Jack B.
Rental Property Investor · Seattle, WA · Member since 2014 · 1k+ posts · 1k+ votes
7y
Originally posted by @Fred Engh:

I live in Omak.
The good: you can buy a $50k house that rents for $600 - $700 (which is, for the most part, better than western Washington on a cap rate or price/rent ratio). There are not a lot of vacancies.
The bad: higher unemployment. Very small town (5,000 people. 40k in a sprawling county). Harder to price comps so you have to understand differences between properties.
I see a lot of acreage cabin deals for almost nothing. Didn't realize rents were so good.
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