All Forum Posts by: Alex Chin

Chiming in with my 2 cents, I am in agreement with the general sentiment that solar power does not currently make sense on a small rental unit. However, in a high-end market like Seattle, conspicuous use of solar panels can add perceived "green" value and appeal to a luxury apartment complex. With rents on a 2-bd unit already soaring past $2,000/month in the urban core and hot neighborhoods, investments such as a solar array to appeal to young, wealthy professionals can pay strong dividends for relatively little.

For example, if you owned a 50 unit tower with all 1-bd.s in the Ballard neighborhood last year, average vacancy rates stood in the 10% range. Given average rents of $1,500/month, it would be worth it to spend $20,000 to install a solar array if it can help you reduce vacancy rates by even a single percentage point. Obviously this is an over simplified example and many factors would go into reducing vacancy rates, but the core reasoning is that if your market is young professionals, that demographic places a higher value on certain features.

Personally, I am in agreement with @Alexander Felice (great name by the way, people named Alex are usually pretty awesome). The technology is still growing and maturing and is not yet ready for roll-out in typical rental units. Give it 5-10 years though, and we could be pleasantly surprised at the potential of the investment. Certainly it'd be nice to reduce utility expenses on larger complexes.

From a landlord's perspective, I would prefer to install good linoleum or tile in the kitchens. Don't want to take a risk of some tenant splattering grease and sauces all over a nice hardwood, and linoleum is easier to clean in-between tenants as well as cheaper to replace if they manage to banjax the whole thing some how.

Echoing what others said, especially the advice from Michael and Omar.

Although, if what Bryan said turns out to be true, the kid might try to break in and retrieve his stash. Might wanna tip of local PD to please keep an eye on the place.

I have not had the dubious pleasure of dealing with such a situation, but at this point, after I got done laughing at the kid, I'd probably follow up on Omar's advice, see if he's on the lease, and if not, keep laughing at him. Would let him know that any ethical-moral obligation I felt to let him retrieve his stuff from his mother's place went out the window when he opened up a meth lab in there and that he may retrieve his effects, under supervision, after he has reimbursed you for lost rent and the cost of rehabilitating the unit.

@Kevin Carrington - Hey there, I assume you are moving for job reasons? Welcome to the community. I would say, given that you are moving from the mid-west, be prepared for significantly higher purchase prices. Feel free to reach out with very specific questions, there's a great group of investors waiting and ready to offer help on any subject.

@Samantha Johnson - quick tip about tagging another poster: type out "@John" and then wait a second. If they are a contact of yours, or are participating in the thread, BP will automatically give you an option to select and tag them.

If you are willing to build your business a little more slowly, you might want to consider giving an investor a cut of the profits in exchange for funding the build. Have you put together a presentation package to try getting a construction loan from a bank? I would suggest a few pages detailing construction costs, and then statements from at least 3 real estate agents projecting the market and sell point for homes of the type you are looking to build. Pictures would be great to throw in there if you can, and then when you wrap up the presentation, just hand it to the loan agent and have them seriously consider the proposition.

Cheers and good luck!

Good morning and welcome to the community @Samantha Johnson and @Kalina Veto.

Samantha, it sounds like you already have a solid path laid out for you and are looking to get started as a developer and have a good idea of what issues you need help with right off the bat. Are there any details of why you haven't been able to secure a loan that you would be able to share for the community to take a crack at? Also, do you focus exclusively on Whatcom or are you up and down the Puget Sound region? Would you do projects say...in Tacoma? Everett? Have you explored offering your services to Canadian investors looking to make purchases in Washington?

Hey @Lane Kawaoka Definitely here you about the market being overheated, Seattle is a tough, tough market if you are a buy-hold investor and don't have the ability to develop.

However, I will hold to the belief that Tacoma continues to offer opportunities for cashflow properties, so long as you are able to negotiate a chunk off the list price. A lot of sellers see the market in Seattle, get stars in their eyes, put their property on the market and then it sits there for 6-9 months. At that point, you can walk in, present your numbers to the seller and demonstrate to them that they won't sell for a long time but if they'll come down 25% off of their price, then a conversation is possible.

@Charles Moore - One reason I could see an investor finding the Seattle area attractive is the recent trend of high appreciation. I am not inclined to bet on it myself, but many investors have started grabbing properties with the anticipation of continued influx of high-paying jobs into the area that has driven property values and rents to ridiculous highs.

 Hubert - I believe that that varies by the bank, I am pretty sure it is a lot more than 4, but it is not a question that I can answer with any kind of authority. However, a quick call to your local lenders (and I do mean lenders, call up half a dozen or so for an overview of your region) should be able to answer that question.

I will say, for the path that I outlined above and with your goal of quickly scaling up to large multifamily properties, the limit on the number of loans you can hold should not come into play as your purpose for buying them is not to build an extensive portfolio, but to gain hands-on experience. Simply purchasing two or three 4-plexes will have you managing a dozen units and give you an idea of what it would take to manage say...a 25-unit building. Buy that building, hold it for a a year or five, now you have direct experience with managing ~30-40 units, and are ready to scale up again and look for a 100+.

@Hubert Washington - I'll outline below a path you could use. Please keep in mind that I have no experience in your market, I have no idea what local housing/rentals/environmental conditions are like. These are simply suggestions and your own risk tolerance will guide your final decision:

Slow and Steady: $100K should be more than enough to afford down payments on a couple small multifamily units. In this scenario, you would be purchasing a few 2-4 unit buildings and renting them out. There is no ideal jump point, but given your confidence in yourself, figure manage these initial properties for around 12 months while constantly evaluating your income, expenses, personal time allocated, viability of professional management, viability of rental market etc. The experience and equity build-up will give you solid ground to use to make the jump to commercial (5+ units) multifamily. At that point, pitching a syndication with the family members you mentioned should be a more realistic option, one that you will have hard experience to back up, and you might look to buy an apartment complex that can support professional management.