All Forum Posts by: John Barrett

@Robin Brown We have used leverage to scale our portfolio.  Originally, I was extremely debt averse and was working to aggressively payoff all debt.  While I am still averse to having consumer debt, I have become much more comfortable with mortgage debt.  We live in a high cost of living area, saving to purchase property outright would have dramatically limited our ability to grow. Given the speed with which properties have been appreciating in our market, we would have never been able to save fast enough.

While I am always mindful with leverage, I see it as a valuable and necessary tool for investing.  Additionally, with all the money printing going on currently, I see debt as another tool protect against inflation.  None of this works unless you can ensure you have high enough profits to service the debt and sufficient liquidity to manage unforeseen events.  The last 18 months have been an opportunity for all investors to test our contingency plans and comfort with the current structure of our portfolios.

John

@Sherief Elbassuoni Is there any liability that you would need to factor in? My understanding is that regulations were passed increasing the time for condo owners and HOA's to assert material defects in construction. However, these may only apply to newly built properties.

Just curious if you happen to know.

John

@Nathan Leger Action is the cure. Do some small action that moves you closer to your goal and it will get easier to take the next steps. One step at a time and you’ll be on your way to your ultimate goal.

Best of luck,

John

@Arslan Rakhmankulov Congratulations on getting started early on your investing journey.  There is a ton of information about the buying your first property here on BP.  The market is extremely hot currently so even properties that need work are selling for high prices.  That said, buying something you can house hack will still allow you get started for the least amount of money and the first $250K of gains are tax free.

Go to local meetups in the areas you are thinking of investing in.  This is one of the easiest low costs ways I know of to find out about what other investors are doing and their challenges and successes.  Networking in this way will also help keep you up to date on which areas are improving and you could target.

Best of luck,

John

@Manju Nat I would suggest you look up RHAWA or WLA as both organizations can provide you with the guidance you need.  If you are planning to substantially rehab the property, you would need to issue a 120 day notice and there are state, county and potentially city ordinances that you will need to abide by regarding relocation assistance for your tenants. 

This is a tough situation for everyone involved and you want to be respectful of your tenants.  That said, the best thing I think you can do is be clear with both your tenants and the housing providers.  Unfortunately, based on how the laws are written, I believe you will likely not have much wiggle room as otherwise you might be open to accusations of discrimination.

Do your best to treat everyone well and understand the assistance you need to provide in order to help these tenants move to their new home.

John

@Daniele Locke The current "Bridge" eviction moratorium is set to expire at the end of September.  The current best information is that the Governor will extend his most recent proclamation again (likely through the end of the year).  There is currently a legal challenge to this so it is possible that this policy will be invalidated sometime between now and when all government restrictions are removed.

As for your question, the easiest answer is to take possession of the property vacant.  That is not always possible given the ever changing rules and when sellers need to close by.  That said, you are still currently allowed to issue notices to increase rent or 120 day notices for substantially rehab of a unit (RCW's will apply for relocation assistance).  Depending on the city / county your are in there could be additional restrictions or requirements that you need to follow.  

There are many great resources from both RHAWA and WLA that can assist you in this process.  The key is ensuring you are following all of the rules and understand the timelines.

John

@Colby Valladares you are doing the right thing by focusing on learning as much as possible.  The amount of content available from books and podcasts will help you get familiar with the terminology and concepts of investing.  I would also strongly recommend that you attend local meetups.  This will give you an opportunity to speak with other local investors to understand what they are doing and the challenges they have to deal with.

While WA state is a tougher place to invest these days than it has been in the past, I still think you can find opportunities here.  Ironically, if you can get really good at navigating/managing to the rules here it can actually be a competitive advantage.  The real key to all of this is determining what your focus area will be. 

John

@Trevor Murphy I think you might have better luck attending local meetups or joining Facebook investor groups in the area to identify and network with local wholesalers.  In the current market (tons of buyers and lots of liquidity) most wholesalers are working with investors they have an existing relationship with.  Lowers the amount of effort they need to expend to and they have a lower risk that the buyer will not close.

That said, based on your goals you may need to look at alternate strategies.  The market in Snohomish County is very hot at the moment and inventory & interest rates are really low.  You might consider looking further out or at properties that have something about them that make them less attractive but you can address.  While challenging, there are always opportunities in every market for those willing to put in the effort to find them.

Best of luck,

John

@Olivia Balch We also use Lifeproof flooring in our rental units.  I like the product and it has seemed to hold up well overtime.  We tried other flooring options but this one has been the best combination of availability, ease of install and cost.

As @Stephen Gray has mentioned, I would be cautious of budget flooring options as your goal is to not have to redo the flooring anytime soon.  The other concern I have had with using the flooring that Costco brings in is being able to source it after they stop carrying it or switch to another color. 

Best of luck,

John

@Jacob Whitbeck Reaching out to an attorney is the right course of action for this type of situation.  The rules seem to be a moving target at the moment and the risk to you of not following the process are greater than the cost of legal counsel.
My general sense is that you should be able to move forward with ending tenancy / eviction this tenant but will be limited by the current CDC moratorium, WA State eviction "moratorium" bridge, city specific rules and general court backlog of cases to process.

RHAHA & WLA both have good resources and attorneys that you can send questions to which could also be a good source for the latest information specific to the city your rental is in.  Obviously this isn't a good situation but ultimately this too shall pass.

John