Is it possible to hit over the 1% rule in the tacoma/seattle area

13 Replies

I shall start with an introduction. My name is Josh Corbin and i am 31 years old. I Am extremely driven towards goals and dreams and real estate has all the factors that keep me motivated and excited. I am looking to achieve financial independence and freedom from the 9 to 5 so I can focus on 2 businesses. I currently run a furniture business www.uneekkreations.com salvaging local hardwoods and building tables and furnishings. I have 2 children that I sacrifice my time with every day to build this business and generate my daily income from boeing. I am really looking for local like minded investors to meet as well.

I am looking into getting a duplex as my first investment deal and the more I read and learn the more excited I get. Currently I live in bonney lake, Wa and I am hoping to keep my properties close to me. I cant seem to find a Deal that hits the 1% rule and I know it would help to find a distressed property but I have not came across one yet in my month long search. How many investors in my area are still abiding by this rule?

Perhaps 2 questions would not be too much here? I am looking to help the mother of my children find a place to live right now and the duplex would be, to me the perfect solution. Does anyone know if I can qualify for an FHA loan on a duplex if my children and their mother will be living in one of the units?

@Josh Corbin welcome to BP. It is an extremely tough market here especially where you are; but don't compromise your criteria it has only been a month. I would also suggest not buying in the slums of Tacoma unless you feel comfortable there. Keep looking; I have been scouring the market for over a year looking for my next deal! All the best!

Originally posted by @Bjorn Ahlblad :

@Josh Corbin welcome to BP. It is an extremely tough market here especially where you are; but don't compromise your criteria it has only been a month. I would also suggest not buying in the slums of Tacoma unless you feel comfortable there. Keep looking; I have been scouring the market for over a year looking for my next deal! All the best!

 

Thank you for your reply and i appreciate the welcome. im extremely excited to get to meet locals that are of the same mindset. I am actually looking in the bonney lake to puyallup area i should have probably mentioned that i have a hard time investing into tacoma although im sure ill get there as i learn the area a bit more.

haha yes i know it can be a risk but right now i feel like at least i can get them into a safe place by going about it this way and the opposite tenant will be paying down the mortgage on the place so it wont be costing me much directly out of pocket to get them into a home.


Originally posted by @Josh Corbin :
haha yes i know it can be a risk but right now i feel like at least i can get them into a safe place by going about it this way and the opposite tenant will be paying down the mortgage on the place so it wont be costing me much directly out of pocket to get them into a home.


Yeah what could possibly go wrong!!!

 

Nice to meet you Josh! I am also 31 :) I currently live in Graham WA and buy and hold in Texas for that reason. 1% is pretty much non-existent here. Washington hold opportunities are great for the appreciation but now isn't the time to buy for that as we are at the top of the market. I learned my lesson with my first home purchase (that I still live in today) in 2007. :) 

@Josh Corbin I would suggest determining what your primary goal is for this purchase.  While generating a high return would be nice, it seems like finding a good place for your children is your real motivation.  As such, I would change your search criteria to find a property in a good location which when rented will breakeven and ideally have some potential for appreciation.

Rarely do people get rich from their 1st investment but you will learn a lot.  I don't really have any better advice than what others have mentioned about the complicated nature of renting to family.  Just know it has the potential to  be challenging so ensure you have a good lease in place. 

Best of luck,

John

Hi @Josh Corbin - Welcome to BP and the world of real estate investing! The PNW is a tough market (like most major MSAs), but good deals can still be found! I recently helped a client purchase a 1% rule property but there were specific circumstances that enabled this to happen...these things definitely do not grow on trees. : ) 

I also find it funny that the guy from Shelton is hating on the "slums of Tacoma." Tacoma has undergone some amazing transformations the past handful of years and will continue to gentrify and appreciate over the long term as more infrastructure is added. 

Best of luck with your investing and feel free to reach out if you have questions!

as I am new here is there a way that I can reply to you each individually?

Thank you all for taking the time to reply I am glad to interact with local investors.

Keith I think that is totally awesome that you get to invest in other states and perhaps that may be in my future It is not where I want to start. your a buy and hold investor but what kind of properties do you primarily buy?

John, The only thing I truly hope to receive from my first deal is more knowledge and motivation to make another purchase happen very soon after. I do really want to find a great location for my children but i am hoping to find a bit of a fixer that i can find some instant equity in.

Aaron thank you for teaching me something new... what is msa? theres a lot of new terminology to take in around this business haha. i supposed ultimately i should have asked are people still investing around here without too much possibilities of even hitting that 1% and knowing that we are just about at the most inflated prices will get to (according to most)