I have a townhouse in Seattle metro which I bought in 2006. Bought it with 20% downpayment for 250K. It was my primary residence and then a rental property since 2014. Since that time it's tremendously appreciated in its value and now I am thinking if I should sell it or continue renting it out perhaps for another year or so. The mortgage including the property taxes and insurance is approximately $1250 now but it's 30/5ARM so the rate will change in six months. The cash flow is about $500/month.
Ideally I would like to invest for a good cash flow but I don't see any deals in Seattle market. Also, I can pull an equity and reinvest but not sure it will be the right move. Thank you for your input.
I have a similar issue. I have a couple highly appreciated seattle properties held since 2006 and 2009. One is owner occupied duplex, the other is a triplex.
I've been looking into various approaches but have the same problem you see -- there isn't much available in the area, and much of what is available is overpriced.
For me, I've ruled out buying anything in Seattle proper until such time as the political climate stabilizes a little bit, but I would be happy to find something in a nearby municipality. For me thats south end, so renton and burien are my top picks but most other cities in south king would be of interest too. For a larger property I would certainly also look at Tacoma. In any case, The triplex I'm probably going to hold for a while longer, but the duplex is a good candidate for trading up. The only problem is I live there, so I would have to move to the new property or one of my other units if I sell.
I don't know where your townhouse is or what its worth on the open market right now, but its safe to say from what you bought for and when its worth probably around double what you paid if well kept. So you would probably be looking at at least 200-300K to reinvest if you sold it. at 25% down for an investment property, that gives you a lot of options regionally if not so many in Seattle. Its just a matter of finding something where the numbers work. (Which for this region is usually defined as breaks even for a recently purchased asset). There are 4-plexes in the south end that are well within that price range, but you will be dealing with a lower socio-economic bracket of tenants that you are probably used to with your townhouse. (Doesn't mean they are bad people)
Its not my thing, but that much would buy you a pretty substantial portfolio in other parts of the country. But I'm personally leery of long distance investing. Too many ways for things to go sideways when you can't keep a close eye on things. But thats just me, I know lots of people do it successfully.
Good problem to have, in any case.