All Forum Posts by: Sean Smith

@Brietta Easterlin Hey Brietta! Nice to meet a fellow Seattle-ite in the forums. Your concept is great, and I have first-hand experience in this strategy having led the sales org at one of the biggest co-living operators in the country Home Room. I've found that rent by the room numbers tend to work best in the South area down by Renton, Tukwila, Des Moines, and the SeaTac surrounding area. That is with a 20% down payment. But with seller financed opportunities, your options open up in the metro.

@Ian Russell it sounds like you're looking to reduce your exposure to maintenance costs, however want to keep the money invested to some degree.

Previous replies in this thread are great considerations (consolidation exchanges, reinvesting into other RE assets like self storage, entering the new development game, etc.).

My two cents: I'd want to maintain diversification across those markets as long as having a distributed portfolio with multiple PMs isn't too much of a headache -- I wouldn't be cashing out all of AK, or all of WA for instance. From there, I'd consider selling off your largest maintenance-concern property or two via a 1031 exchange into newer-builds. Many builders today are offering low interest rate incentives to move inventory quickly. This is an interesting window of time to reinvest into lower maintenance costs and lock in a low rate.

There's a great study put out by Harvard about the aging rental stock https://www.jchs.harvard.edu/sites/default/files/reports/fil... -- the US is at all time-highs for median property age with a glut of housing that is falling behind code, accessibility, and renter needs. I'm working with a handful of investors to trade into newer buildings with a belief that the lower maintenance costs and the higher desirability will yield better returns in the long run.

I also have a colleague who holds a position in a hard money fund getting a consistent 8% return. Could be an interesting option for you to get higher returns than a HYSA, just no equity build up and it's taxed less-than-favorably.

@Hailey Peterson I'll jump in on this topic as a pro-Washington counterpoint. I'm a big proponent of Snohomish county for investing -- it can provide cashflow, a lower entry point than King county, significant appreciation, and favorable zoning laws (multiple ADUs, lot splitting, etc.). Buy a solid front property, build up some equity and use it for more units on the same lot down the road. If you go this way, I'm happy to make an intro to a few great PMs as well.

@Zhenyang Jin there are a lot of unknown variables in the scenario you present, however lower caps tend to produce more stable assets, with lower vacancy, in higher demand areas. Higher caps tend to produce more cash-flow day 1 but have potential risks (higher vacancy, lower demand, etc.). 

My two-cents: cash on cash is real, appreciation is speculation

@Sundar Sritharan sorry to hear all the issues you're experiencing with Mynd! It's worth noting that Mynd was acquired by Roofstock last year and has gone through multiple rounds of layoffs. Might be time to look for a new local partner. 

Hi @Anna Lee there are tons of resources and great people here to help you improve your skillset. Welcome to BP!

Hey @Brandon Phillips I've been a PM with a large scattered site portfolio (750+ doors) in a past life and have been under the hood of many PMCs. I suggest checking out lob.com for automated mailing of notices. Our company didn't use Yardi but I'm sure it'd work with your process just fine. For pay-or-quits consider email and mail only, not in-persons unless you're leaning towards opening unlawful detainer. 

@Audrey Sommer I'm late to the party here but would agree with John's sentiment above. Snohomish county provides some of the better cashflow opportunities in the Puget Sound region. Places like Everett specifically have flexible zoning laws for ADU and DADU's if you have the means. Or simply buy with decent returns today, and build ADU/DADU once you build up some capital later.

@Khang Le I have experience with dozens of scattered site property managers in king, snohomish counties. It really depends on what you're looking for. Each PM offers a different mix of Cost / Responsiveness / Systems. I'll drop a few recommendations in your inbox!

@Kyle Folmar On paper keeping the Tacoma rental makes more sense. Your net take-home is much higher, and the appreciation in the PNW is solid especially when considering compounding returns. 5% annual appreciation of a 500k home is huge. In a low price point, the actual dollar increase in value isn't as powerful. Hiring a PM is a must (happy to recommend a few) in Tacoma. Rental laws are tough to navigate for part-time landlords. 

All that said, if you want to cut out debt and have a rental nearby in a more landlord friendly state, it might make sense to sell.