All Forum Posts by: Brian Ellefson

I agree with Ellie - no sensing in turning it political. Some may not know this, but in Seattle the owner also must apply for a Tenant Relocation License if you'll be giving a tenant notice due to a remodel. And if they're considered low income, you and the city each pay half of a $3,450 fee that goes to the tenant to help pay for relocation costs, etc. truth! Gotta stay on top of all the rules around here. My wife and I are still making it work really well for us - despite the city's best efforts.

That's a tough sell with that rate of return. I'm also curious to see if anyone can recommend something here. We're in Seattle, doing projects in town, and although the purchase prices are much higher we're seeing good rates of return on cash. But we're also buying properties that haven't realized their rental potential yet. This particular property, there doesn't seem to be anyplace to go on it unless those rents are below market.

It's almost too little information here, but a basic jumping off point (for my wife and I anyway) is to determine what rents could realistically be (with or without a remodel) and then determine your cash on cash rate for the property. I think the COC rate is one of the most important figures to know in any acquisition scenario. "What am I going to earn on my cash?" You'll develop a minimum rate for yourself that'll make you go for or pass on any given property. Many other important aspects, but that's the biggie to us.

James, the city council voted it in, but the mayor hasn't signed it yet. I hope he doesn't. It's gonna have bad consequences and it'll end up hurting a good portion of the people it was suppose to protect from discrimination. Guess we'll see.

Hey guys. Another newbie to BP. Remodeling, managing and holding properties in the Seattle area with a few places out of state as well. Just looking to help when I can and ask when I don't know. 

My wife and I are avid DIYers, taking old multifamily properties and making them new again. We do about 80% of the work ourselves. I was previously a business banker, loaning money to many different types of businesses and managing relationships. Full time investor/manager now. 

Nice to meet you!

First thing I'd look for is number of electricity meters on the building. That will tell you how many units are at least legit and permitted (most likely). 

We use a good friend of ours. We can text or call her whenever and she's always on the ball. Quick. Easy to work with. Proactive. You need to find someone that you feel has your back. It's probably not that guy. 

These were bank customers - not tenants. 

I was a commercial lender before this and some customers came into the bank who were interested in borrowing money for a large commercial property in the middle of town. She made quilts, he made bird houses. They wanted to open a retail space and sell just those quilts and bird houses there. I had to ask them, "Ok, at any given time, how many people around here are in the market for a quilt or a bird house and how many quilts and bird houses would you have to sell each month to pay the mortgage on this multimillion dollar property?" They couldn't answer that. And then the guy says, "Well, I should probably let you know our credit aint that good." His wife yelled at him, "Why would you tell him that?" It just got worse from there.

Depends on your goals and your skill set. Typically it's great to make some money going in - so the worse shape the property is in, the better. Because once you remodel it (if that's what you'd do) its going to rent out for more money. However, if you're buying to just rent without improving it, there may be issues (which would explain the time on market). Personally Id love to find a property that I want that's been sitting on the market awhile - usually means there are issues that other people aren't willing to tackle or the units haven't been fixed up, etc, and that means a decent deal for us going in. 

Have you run any analysis on it? How much could you rent for as-is? What condition are the units? What kind of return are you looking for? What are your plans for the place?

Cant answer the first, but typically theres verbiage in the loan docs that says you can't rent out that second home for a certain period of time (one year, etc). If the bank found out they could call the note due.