All Forum Posts by: Alex Chin

Hello Douglas,

Couple of quick things about Seattle that are probably good for you to know going into this.

If you are looking to buy a house, especially in one of the higher-end neighborhoods, then prices will probably quickly climb into the $500K-$1M range and beyond. Generally, unless a person is from a city like NYC or SF, I usually tell them to prepare for a bit of sticker-shock when buying in the Seattle area. Outside of areas like Ballard, Fremont, etc., prices can get a bit more reasonable but I wouldn't expect to find much for under $200K. Supply is also very tight and good properties will often receive multiple offers above asking. It is not uncommon to see inspections waived and other concessions included.

If you are looking to rent, again, in the core areas of Seattle, rents have been climbing rapidly and a house/apartment/condo large enough to accommodate a family will probably price well above $2,000/month.

I do have an agent that I recommend for her high level of energy and good communications skills, let me know if you would like her contact information. I believe she focuses exclusively on buy-sell, so if you are only looking to rent, you may want to look in a different direction.

Cheers, good luck, and welcome to Seattle!

 Denny - Sorry, I am the wrong person to talk about quick re-lists and flips with. I am strictly a long-long-term buy and hold investor.

On the estimation of rental income, you are missing a fairly long list of stuff. Just off the top of my head, you'll need to account for:

Insurance Expense - I have no idea what insurance costs in Vancouver, WA, but I would guess in the $50-$100/month range. You may or may not need flood insurance, that can add some serious monthly costs.

Taxes - You'll pay between 1%-2% annually to the government, account for that!

Vacancy - It is highly optimistic to assume your property will never be vacant. I would suggest assuming at least 5%, although rates will vary from year to year. Keep in mind that if you are vacant for 1 month out of the year, you're looking at an 8.33% vacancy rate.

Maintenance - potentially a big kicker. Upkeep on the property can range from almost zero to MASSIVE. What happens if the tenant discovers plumbing issues? Knob and tube wiring? Pests? Wood rot?

Capital Expenditure - You should keep in mind that if a major appliance or component of the house fails while you are holding it with a tenant in there, it is on you to address the issue. A refrigerator going dead could set you back a couple hundred bucks and wipe out your profit for that month. A boiler could kill your cash flow for even longer than that.

Turnover - even if you manage to have a tenant move in without missing a beat on rental payments, you will still need to spend a decent chunk of change to repair the wear-and-tear that the previous tenant leaves behind. As any SFR owner will tell you, those costs can quickly eat through the security deposit and then some.

There are a lot more things you'll need to account for, but off the top of my head, the above expenses are a starting point.

@William Hatcher - Welcome to the site and the real estate investment community of Puget Sound.

I am a small time landlord with property in Tacmoa's Hilltop neighborhood. However, I live in Seattle and definitely sympathize. The market is white-hot and really driving a lot of folks to commute from further and further afield.

In terms of resources the community can offer, folks are always happy to give recommendations or analyze potential deals for you. Feel free to PM me for real estate agent, plumber, and house inspector recommendations.

I would also highly recommend searching for "house hack" and navigating to the BiggerPockets Blog section for a great series of articles on doing exactly what it sounds like you're thinking of doing.

Finally, connect with @Troy Fisher, and @Kevin C. as they run the local in-person meet-ups that are great (free!) events to attend.

Hey @Elizabeth Colegrove! Welcome to the white-hot Puget Sound market.

For conventional lending needs, I recommend John Nguyen, with Procura Mortgage. He is accustomed to working with investors and has been great as far as communication goes. PM me if interested and I'll connect you.

For Meet-Up groups, @Kevin C., @Troy Fisher, and Tiffany Plovie run the Tacoma-Eastside-Seattle area meet-ups; they are great folk and we regularly have 20-60 investors at each of the 3 different monthly meets.

Cheers, and good luck!

@Nick Gorash, @Tin Nguyen Welcome to the Puget Sound REI community! Here's to future success.

Nick, depending on your level of experience and confidence, I would suggest that you consider partnering with an experienced investor for your first flip. You obviously have a strong base on the nuts-and-bolts side of things, but might be able to benefit from working with someone who is used to the process of prospecting, financing, and marketing the project. In return, there are a lot of investors out there who are desperately hunting for a good GC that they can trust to bring the project in on-time, and within the budget.

Tin, do you mind elaborating a bit? Sounds like you're interested in flips as well and are just looking to get off the ground for now?

For the both of you, I would recommend staying in contact with @Troy Fisherand @Kevin C.as well as Tiffany Plovie as they run the BP meet ups for the Eastside, Tacoma-Lakewood, and Seattle respectively. Good folks and investors themselves.

@Rudy Manna - a guy you might want to talk to is @Ryland Taniguchi, he's done exactly that numerous times in the Seattle area.

Here's to success then @Jony Villegas! As an agent, sounds like you already have a head start on the education that you will need.

Feel free to ask questions, no matter how simplistic they seem to you, someone on the site will probably be able to answer in detail.

Hey @Lane Adams. Good to have you join the site. Any questions in particular that you are mulling over right now?

@Mike Hanson - speaking personally, I would first and foremost not make such a large investment in condominiums in general. The lack of control over annual costs are a risk that I am not particularly comfortable with.

That being said, if you are good with condo investing, I would probably base my decision on the degree of control that buying 8 units in one building gives you. i.e., if it's a small complex and 8 units gives you ~50% control, I would probably go for that. If it's like, 100+ units, then 8 units doesn't make too much of a difference unless the numbers are there.

Also, 2ba vs. 1.5ba, you're looking at increased initial buy price, PLUS likely higher maintenance costs going forward. We don't know your numbers, so can't say if it is worth it, but it probably isn't worth an extra $50K/unit, if it's an extra $50K spread across all 8 units...maybe.