All Forum Posts by: John Barrett

@Anthony O'Brien We are still purchasing in WA State and while it is a challenge there are a number of things that others have mentioned you can do to protect yourself.  Screening being the most important thing you can do with selecting your tenants.  Inherited tenants coming with the property seem to be the biggest problem we have had but that can be mitigated by asking to receive the property vacant upon closing.

Ultimately this is a numbers game and if your projected returns (adjusted for the actual risks in the market) are correct you should be just fine.  That said, this entire last 18 months has been an exercise in why having sufficient liquidity / capital reserves are important in this business. 

John

@Eric Cheng I have used Rob Trickler out of Everett for evictions in the past and he was great to work with.

John

@Libby Tucker I personally like the 1031 route as well but depending the the IRS debt/lien would be looking to pay that down as well.  Personally, I never want to be in debt to the government as I just find it unnerving.

If you would like to be in the Seattle area, there are a number of places in the greater Seattle MSA that would allow you to purchase a newer property with less cap ex and generate a return.  This would allow you to capture most of the appreciation (knowing this is speculative) as well as the return generated by the investment.  Then it is really a question of what your return criteria, ease of management and overall investment strategy.

Best of luck,

John

@Daniel Fulkerson We are investing in a high cost of living market (outside of Seattle).  We purchase smaller multifamily properties focusing on ones with deferred maintenance and management issues.  While it is hard to find properties that make sense given the high purchase prices, we have still been adding to our portfolio over the last few years when opportunities present themselves.  Our investment strategy seems like it is very similar to what @Shiva Bhaskar is doing.

Take away message is, there are always opportunities in every market.  You just have to be really focused on finding them and then have the ability to move quickly.  The other thing I would say is if you are able to look at an asset differently than others you can identify ways of unlocking additional value other investors may not be seeing.

John

@Kamran Rahman We have both sold and purchased properties earlier this year during this prolonged eviction moratorium.  In both transactions the tenants did receive proper notice but in both cases were still in place at closing. 

My view is investing in real estate is about solving problems.  In these cases, we knew we would have properties with problematic tenants to deal with until the moratorium ended or is struck down by the courts.  Even with these challenges the properties we have acquired will be positive long term investments for our portfolio (near term pain but long term gain). There will always be opportunities in the market to capitalize on, you just have to determine if the payoff is worth the near term challenges. 

Did you decide to invest in another market or have you moved on to a different asset class?

John

@Sean Schneegas You should also checkout meetup.com for various local groups getting together.  Most were on pause for the last year and a half but now people are starting to have meetups as the state reopens.  Additionally, there are a number of Facebook groups covering different areas and types of rentals that are really good for networking and information. I like the WAREI group a lot but there are also a number of others that are really good as well.

Best of luck in all your investing,

John

@Peter Guinto I would suggest you look up local meetup groups on meetup.com and join some of the numerous Facebook groups for real estate investing (there are a lot for the Seattle area).  This will allow you to see what other investors in the local area are doing and make some connections. 

House hacking is a great strategy and will help you get into a place with the least amount of money out of pocket as well as offset your housing expense.  Just remember, no matter how great your plan is, something will go wrong and having reserves sufficient reserves set aside will keep it at the level of problem / annoyance rather than a full on emergency.

Best of luck on your investing journey.

John

@Account Closed People respond to incentives.  That is as true for landlords as it is for tenants.  No one likes being told what they can or cannot do with their personal property. Given the sever shortage of housing in almost all of our cities but specifically the PNW, I argue the policy focus should be on creating new housing.  Nothing you have listed would facilitate the creation of new housing.  As numerous others have stated it only reduces the housing supply further hurting those most vulnerable in our society.

It's time our "leaders" started making the tough decisions that will lead to additional supply of housing (reducing burdensome regulations on building, as well as these unfair laws against landlords).  Unfortunately, until this happens our housing supply will continue to diminish in exactly the places it's needed most.  The irony is (in my experience) that small landlords provide some of the best (clean, safe & functional) market rate or slightly below in the vast majority of cities.  These types of policies are eroding the supply of those units. Just because people like to hate on landlords doesn't mean society will be better off without them and the service they provide.

John

@Sherief Elbassuoni Thank you for putting together this meet up.  It was really nice to get out of the house and have an opportunity to chat with other investors.  Looking forward to your next meetup.

@Iliya Muzychuk I think this will lead to fewer houses and apartments coming online / available which will further hurt the supply of housing.  So the dramatic shortages we are seeing seem likely to continue for the foreseeable future.  What happens once material costs (wood, components, etc.) and labor become more readily available is anyone's guess at what point that will happen. 

John