All Forum Posts by: Sean Smith

@Alan Eslinger Everyone's definition of MTR seems slightly different. When I hear MTR I think 3, 6, 9 month leases. Longer than an STR stay, shorter than an annual lease.

Using that definition I don't have a ton of MTR experience so maybe someone else will chime in.

But I do have a decent amount of experience with rent-by-the-room / co-living properties. Think annual leases for individual rooms with furnished common areas. 

In the Seattle area these rent on the low end around $650 a room/mo, and the top end I've seen is around $1200/room/mo. With a 6 bedroom house, this strategy could be a game changer when compared to the average SFH rents.

Furnished finder is a good place to advertise, and I've also seen success using Zillow's room rental feature and even FB marketplace.

If you're self-managing, it goes without saying but make sure to screen your prospective tenants throughly. 

If you want to hire a PM, there's one co-living mgmt company in the area I'm familiar with that be worth talking to. 

Supplemental docs found in the disclosures and rent roll from the listing broker. If I were offering on this property I would write in a successful eviction as a condition of closing. Unless you're getting an incredible steal on price I wouldn't inherit a partially processed eviction.

 @Nana Sefa this property has an active eviction taking place in one of the units, the units are outdated through and through, and there are a few Zinsco panels that should be replaced. Overall it needs more work up front and possesses more risk than I'd be willing to take on for the amount of return I expect to see.

That isn't to say that someone couldn't do well with this property. Just not for me or any of my investors actively looking.

@Bao Vu I know the property you're talking about based on the price. 

Overall the numbers are okay on paper if you can get average/above-average rents within a year. Your market rent estimates are realistic, maybe a bit conservative which is a good expectation to set. 

My calculations showed this deal breaking even around 30% down with average rents. The market can support higher rents with updated units IMO -- plus there's some value-add upside in the equity growth through improvements. I'd lean towards lower down, saving cash for renovations at the turnover of each unit. This one will need it.

Personally, I looked into the details of this deal and decided to pass on it for a few reasons besides price & rents - happy to share my findings.

Hi @Khushbu Magiya I've had a handful of clients work with Real Property Management Select and RNB Property Management over the years. Happy to DM you some info about a few local players.

@John Schneble I'm sorry to hear about the divorce. Kudos to you for taking this difficult time and turning it into an opportunity. 

Of course, consult legal counsel to confirm who has asset ownership and don't spend a dollar until you know for certain. 

I suggest exploring a few strategies to see which can yield the best returns. Rent-by-the-room/coliving is becoming a great strategy in our market to achieve higher rents. Short term rental is another option to increase revenue beyond the traditional LTR approach. Both of these strategies require more active involvement in the management of the unit, or you can take the Long Term Rental approach for some stability.

Best of luck!

@Joe West welcome to the forums! BP has a wealth of knowledge if you know where to look. I suggest starting to read through fix-and-flip analysis threads. Look at posts from our local market here as well. 

Start analyzing deals everyday and bounce these numbers off other investors and brokers. Looking at on-market properties can be a great place to run fix-and-flip analysis when starting out, too. For example... at what price would an on-market deal need to be at for you to make an offer? 

I have deals land on my desk frequently and would be happy to send them along. 

Padsplit doesn’t serve the Seattle market yet, however @Kam Nak I know a company that specializes in this and has a decent amount of doors they manage locally. Will shoot you a DM and can make an intro.

@Ken M. 7% tax on capital gains doesn't apply to real estate, but yes I understand the sentiment.

@Cathy Ries I believe it's worth talking with a tax expert to position yourself strategically as a well-qualified loan applicant, while also reducing your taxable income as much as possible. This doesn't have to be a long, arduous process - it can likely be done at at the same tie as you're analyzing deals and learning the market.