All Forum Posts by: Michell P.

St. Johns is one of those neighborhoods people describe as "eclectic" and "up and coming."  Definitely a neighborhood you'll have to visit to see how you like the vibe.  But, crime isn't bad (which is relative, really, check out portlandmaps.com and you'll get a good feel for city stats), and the schools are OK (7/10 on zillow, a few lower ranked ones too though).  Housing prices in St. Johns are still low, so expect crime and schools to improve as the area improves.  

An ADU is an "accessory dwelling unit" - usually a garage or basement that has been turned into an apartment. They're pretty popular up here, but are often listed as SFHs instead of duplexes, so you have to search them out.

A 4bedroom duplex is going to be a hard find, they're not very popular over here. You might want to look at St Johns, there are a couple in the NW side of that neighborhood, but otherwise you'll probably want to find a house with an ADU instead of a duplex, if 4 bedrooms is a requirement. Goodluck!

I'd also vote for southwest Portland but I'm biased.  And you really don't want to have to drive on the freeways during rush hour - especially traveling between Portland / Vancouver. Duplexes in nice areas over here tend to be snatched up almost immediately, so you might just want to scour redfin.com for awhile to familiarize yourself with prices instead of looking at particular properties.  

Personal preference - in school I had a professor who basically beat it into us that any money invested should be returned in 7 years for a good investment.  So I like the number 7, and it seems to work imo.

So for example, I have a current 4plex @ $250,000 - brings in $5,800 in cash flow after mortgage, for about a 8.8% roi.  If I could immediately turn around and sell it for a $41k (7 x yearly income) profit tomorrow after all selling expenses, then I think that'd be a good trade, because with my 25% equity I could take the earnings and buy a better property.  But at just a $30k profit (5 x yearly income), I'd rather keep the property's passive income YoY.

How would you look at his scenario? 

Hi Marcus, 

I'd do a realistic analysis of how much money I could make in profit a year - include all expenses.  Multiply that by 7 years - and make sure your rent is reasonable.  If that dollar amount is less than what you can make right now by selling it, then I'd sell and find a better investment property (and keep in mind all the costs associated with selling) - but only if there are other, better, cash flowing properties in your area you could afford.  (Also assuming you don't expect it to appreciate in value much more)

Or, you could see if you could get a line of equity on it and use the funds to buy another investment property. 

What are you leaning towards? 

Its always the buyer's responsibility to do the due diligence.  You can write it into the offer, but usually a seller won't be willing to pay $400 for an inspection when you can just walk away with your earnest money after reading it.  

If you call up the realtor, they'll walk you through the inside - and usually you can get a contractor to come with you and give you an estimate to repair if you know it's going to be a complete rehab.  Just be upfront about what you want to do when you contact everyone.  

If you need financing usually the bank will demand the seller fix contamination issues / roofing issues, and then the seller will refuse, so financing will usually fall through in this scenario.  

Your first step should be to find a mortgage broker you like.  They'll be able to give you financing options and get you comfortable with a particular price range.  With 3.5% down you'll have higher monthly payments.  

It depends on how much money you have in reserves to hold it - and how easy it'll be to fill it.  I believe it's on the recent bigger pockets podcast where the guest said he likes to put up a craigslist ad with the hypothetical unit information + pricing and see how many interested parties respond within a week.  If you hear crickets, could be why they're selling instead of filling.  

And in this scenario make sure you do a ton of due diligence.  

On the listing you can do a "all offers will be submitted to seller at *date"" - maybe a week after you put it on the market.  It gives everyone the chance to evaluate the property and submit their "highest and best" offer.  Or just tell everyone you'll respond back at a certain time and that there are multiple offers and they should submit their best?

Look for a "mortgage broker" instead of a "loan agent" - a broker will submit your offer to multiple lenders for you.  You absolutely can talk to more than one loan agent at a time - just let them know you're shopping around.