All Forum Posts by: Heather Hearsey

In Seattle there is such a lack of inventory that even if you have 20% down and a good credit rating you aren't going to find a house to buy so you end up renting. A few years ago I had bought a house but couldn't stand my neighbors and just really had to move. There wasn't anything on the market, it was a lot cheaper back then but there just wasn't much to choose from. So, after months of looking we bought a duplex figuring we could at least live there until we found something. We had friends who were renting a house but one of their roommates moved and it was too expensive for them ($2000) so they took our unit of the Duplex ($1300) and we moved into the rental house while we tried to find a SFR for us to move into. We were essentially breaking even for those nine months.

I have a friend who got divorced and rents out her house (2bd./1ba.) in Seattle for $2000/mo. and rents a studio apartment for herself for $1300. The problem here is lack of inventory and a lot of people with $.  Sure, you can sell your place for a small fortune but where do you go after? I have two friends/clients in this situation. One of them sold her townhouse in Fremont after her co-owner wanted out and she thought she could get something smaller and have $ leftover;  we put in at least 25 offers (20%+ down, 800 credit score, government employee, most offers were 10% over asking). over a 12 month period, didn't win any of them. She finally decided to take a break and just keep living with her boyfriend; in a rental. The other house was in Ballard and she could have sold for a pretty good profit (bought as a foreclosure in 2010) but she still felt like she would've needed to make an extra 10-20% profit in order to be able to move. 

Currently, I'm getting $1500 for an 1100sf unit and $850 for a 900sf unit. They pay all their own utilities and each unit has 2 parking spots, storage and a yard.  I could probably get 15 -20% more but all the tenants are friends and I don't have to worry about anything; they maintain the yard, try to fix things themselves before having to call a repairman, heck, they even took out the old carpet and laid new laminate flooring, I just paid for materials, dump fees and made them a lasagna! I was lucky and bought it in 2013 and the rents cover my mortgage and general upkeep whilst the value has gone up almost 50%. The good, the bad and the ugly of the Seattle market!

This is from the Tenants Union of Washington :

http://www.tenantsunion.org/en/rights/faq/rental-a...

Do I have to move out at the end of my lease?

Look to the specific terms of the rental agreement to find out whether it automatically reverts to a month-to-month tenancy. Many leases automatically roll over into a month-to-month tenancy but must say so in the lease language. If the lease does not have specific month-to-month language then RCW 59.18.220 states that the tenancy ends at the end of the lease term. If your lease states that your tenancy ends, you are required to vacate at the end of the lease period. You may ask to stay longer by communicating with your landlord in writing or asking to sign a new lease. If the landlord accepts the rent for the following month after the term of your original lease ends, then you have established a month-to-month tenancy.

It's always best to document all interactions; leases, payments, conversations about repairs, terms, etc. I have a duplex so only 2 tenants but we text each other about any issues. One of them travels a lot so will pay rent into my Paypal account so I will write a receipt, take a photo and send it to him.  The landlord tenant laws have become a bit more complex in Seattle lately so it's good to keep up on them.

Good luck!

It's a good idea to look at city and county landlord tenant laws and to do so yearly. I bought a duplex  in Seattle a few years ago and at that time I didn't know about the need to register. Of course, I found that out later but the point is the rules do change and it can be often so it's a good idea to keep up on them so you find yourself violating and laws.

Good luck!!

You definitely need to read the city and county landlord/tenant laws.  Some cities don't allow you to take $ off rent for repairs or labor that a tenant may have done, you need to pay them separately. That is actually better for your taxes anyway. 

In order to save time when showing you can have an open house; advertise on Craigslist, newspaper, etc., mention that you will need prospective renters to bring id, proof of income, references, $ for credit check, etc. Have applications for them to fill out. RentalLeaseagreement.orghas leases and applications as well and I think they free. Zillow also has some forms, like walk through checklist and credit apps.If you expect there will be more than a few people, make copies of the questions you would like answered so you will have those when it comes time to actually interview them. Think of it like a job interview. A lot of renters will like the idea that you don't live near by and won't be "bothering them but they will want to know that if something goes wrong you will take care of it. I live close to my tenants and we have a procedure whereby they text if it's something small and they will usually just take care of it themselves and I will pay they for time and materials but if it's something like a broken pipe or the furnace not working they will more than likely call and I'll get a repairman to come out. I've been lucky and my tenants have been able to meet with the repairman and the repairman just sends me the bill. There could be times when they may not be able to be home or that the repairman wants $ upfront but I've managed to avoid that.

Good luck!

Are the current cabinets real wood?  I'm kind of a long term flipper (3-6 years each)., I've done 4 kitchens of varying degrees. I'm in my 6th house, it's in Shoreline, Wa. and it was built in the 50's. The wood cabinets were in surprisingly good condition so I just thoroughly cleaned them, sanded where necessary and polyurethaned them. They had replaced the hardware in the 70's so I went to the Re-store and Ebay and bought all new old knobs.  You can go to HD, Lowes or Ikea and get cabinets for fairly cheap, it's the counters and everything else that's gonna get you. Don't bother replacing the cabinets if you aren't going to have newer matching appliances and countertops, lighting, etc., it only draws attention to what wasn't done. If it's not that big of a kitchen you may find people on craigslist who are remodeling and will sell for cheap if not give you cabinets if you remove them yourself. Seattle is pretty Eco so when I show a house where the seller made upgrades just for the sake of making it look slightly newer, the buyer feels guilty because they don't like them and will want to replace something that is new and thus wasteful. I've viewed many homes where the seller has left the tags on appliances or cabinets to indicate that they are new only to have my client ask if I think they could return them.

Point is, don't do more than you need to and don't do something subpar. In our area it just isn't worth it, I've seen places that are in awful shape sell for the same amount as the place next door that had "some upgrades".

Good luck!

After reading all your updates I assumed you must the property must not be in Seattle, if it was you wouldn't have as much issue renting but you would have the issue of the new rule whereby it's a first come first rent basis and allows the tenant to pay their security deposit in installments! 

If this time of year is really that slow you could offer a "trial lease of 4 months or just do month to month giving you both more flexibility to get out of it if you desire.

Your case is the exact reason why I dread having any of my tenants move. I now have to have a very specific list of questions and parameters for each potential renter so that I won't "discriminate" against anyone. All that will end up happening is that landlords will raise the bar on credit scores and income and raise the rents as well. It's supposed to help reduce the bidding war situation with rentals and give people with less income but good references and credit ratings a better opportunity to get the place but they have to get there first?! If your working a couple jobs or have kids the likely hood you'll be able to view a place first is unlikely.

Good luck!

I don't know what rents are out there but if she isn't renting in now that seems like a real loss of revenue. 

As far as buying it goes, you should get the land and building checked as that could cost a lot more than $40k if it's a real problem. You wouldn't need to spend as much money fixing it up if your renting it vs. selling it.

"this will be our source of income" Will you both be retiring from your current jobs or will you still have other income? Do you have any equity in another property or plan on selling another property? What part of Washington is this property in? 

I would say that I am in a similar situation and age. We are wanting to purchase a property as an investment, my husband continues to work but I have been a real estate agent for the last couple years not making very much (household income of about $150K). We have equity in 2 other properties but like you only have about 10% down and have not been able to find a lender.  Your situation seems even more tenuous given this is a business venture. 

I assume you have looked into Small Business or Women in business loans? I know they aren't usually very much $ but could help with capital. Also assume you've looked at owner financing, lease to own or assuming their loan if they have one? Depending on their situation and the location these kind of businesses can take awhile to sell so they be willing to take some cash now just to get out from running it.

Sorry that probably wasn't that helpful. Good luck!

25+ years in food service and 20 years flipping houses. Never use marble..for anything. It stains really easily and it's slippery so you would not want it on a floor or bathroom counters. I would go with cement, epoxy or laminate flooring; material and labor will be much less than any kind of tile. Like Thomas said drywall will be the least of your costs. Make sure you use premium kitchen/bath paint for easy washing. Spend $ on decent equipment, the things customer's use and see (tables, chairs, lighting, art, etc.). Don't forget signage and curb appeal. Good luck!

What kind of investment properties are you interested in?

I did long term flipping (lived in the house for 3-5 years fixing it up myself) while working a full-time job but when I got laid off in 2010 I decided to get my RE license so that I could handle my own transactions and perhaps pick up a few clients here and there. It can be a bit costly for the classes, fees and licenses but it has paid off for me. I have mainly been interested in SFR's with possibilities for MIL's or Duplexes both of which are pretty easy transactions but if you are wanting larger multi-units or commercial properties you will want someone who really knows those. The other thing I would look for is someone who has a good knowledge of the areas your interested in or most importantly, with Seattle being so expensive, someone who knows about the outlining areas that are up and coming because these are going to be the places you will be able to see the best appreciation from. Good luck!