Greetings, I moved from Green Bay Wisconsin to Seattle Washington about 2 years ago. My shock was how expensive real estate is compared to Midwest in general. • I would like to know where is a good place to invest in Washington state? Meaning being able to buy cash flowing property 1-4 units for buy and hold? I know Brandon Turner is having a great time investing in Washington state, so I know it is possible to find great deals in WA.

Pavel, Cowlitz county cash flows, but not sure I'd recommend it. Grand Mound seems to be booming. If you want to tag someone, type the @ and start typing the name. Watch the bottom of the screen and click on the name when you see a match.

Account Closed http://www.heraldnet.com/article/20140604/OPINION01/140609710/

Account Closed I also bought a duplex foreclosure a few blocks from you a couple of years ago in the Hilltop area-- on 8th St S. I spent about $20k fixing it up and making it presentable, but my biggest problem with that property is the vacancy rate. I've had some great tenants move in, but they don't like to stay because the neighbors on both sides are extremely slovenly. I think the tenants in the duplex to the left of mine are hoarders, and the tenants on both sides hang out on their porch all day smoking cigarettes and scowling at people who walk by. Right now I've had one unit open for many months, have gotten dozens of prospective tenants through the place b/c it is a clean, nice unit and it shows well, but unfortunately those neighbors keep anyone good from moving in. I get $1350/month in gross rents when both units are filled ($600 + 750), but half that when there is a vacancy (I would bet that the duplexes next door probably rent out for $400/unit given their condition). I also pay about $200/month in WSG for the duplex. All in all, my SFRs in Tacoma cashflow better than my small MFs after I account for vacancies and utilities. That said, it still breaks even after all these issues, so if Hilltop ever gets cleaned up I think it'll be a good investment. It's not bad enough that I will sell it, but it's not good enough for me to make additional MF investments on Hilltop either. Hope this helps Matt, and I wish you the best of luck. Hopefully Hilltop cleans up sooner rather than later for both of our sakes, but it has been a work in progress for the past couple decades.

I recently bought a foreclosure duplex in Tacoma in the Hillside area below Yakima. I am close to getting it ready for renters. It will be my first in the area. At this point it looks like it will work nicely. I will know for sure shortly ...

I have multis in Cap Hill and Fremont/Ballard. The most demanded locations with high cash flow. The whole Puget Sound is overpriced for purchasing. Tacoma was okay until a few months back and now it is way over priced for what it is. I know Downtown/Proctor/Stadium very well. I met a few people buying in Seattle currently and they are in way over their heads. The different parties bid up the already over priced list price just to get it. I do not know how they afford these properties. And one is an attorney. He wanted an investment property so he went and over paid to get one. General properties are pending within two days of listing all around the areas. I have agents digging for my phone number online and in public records cold calling begging me to sell since the inventory is low. I buy low and sell high. I do not why people are buying at all time highs like no tomorrow and constantly bidding the markets up. Another bubble. I believe Seattle will implement rent control with the $15 min wage. And when that happens all the freeways are going to be tolled in another two to three years.

@Pavel S. Have you been investing already or new setting up shop? Do you have a team set up and how hands-on do you want to be managing rentals - outsource or do it yourself? This may determine where you look. Also, are you working a job? (Sorry, I can't tell these from your posts). I live in Bellevue and have lived in Seattle as well. Areas like Bellevue, Seattle, Kirkland, Redmond, Issaquah are very tough to cashflow** (unless you come across offmarket deals or you have an in to fix something that most investors can't/won't undertake). **Positive cashflow to us means positive money we can consume/save/reinvest and not have to take it back. So it's Rent less the following: - PITI - vacancy (6-8%), - maintenance (5-8%) - legal reserves (landlord tenant questions) - accounting (tax returns gets more costly as holdings increase) - lease up and makeover assuming 12-18mo turnover and - some capital reserves - paying myself 5% to manage (in case we outsource management in the future). We invest out of state in SFRs and apartment partnerships as well as Pierce County where we can hit our investment criteria. We are starting to look at Snohomish county as well. Best way is to drive some areas, meet agents and property managers LOCAL to the area and ask them to outline neighborhoods to consider and where to avoid. I personally haven't gone past Lakewood and Puyallup due to drive times. An hour each way is plenty for our family. At one point in 2012 I had 4 Tacoma rentals being fixed up (2 whole-house DEEP makeovers and 2 smaller makeovers) and a Shoreline flip. That was a lot of driving! It's all running smoothly now (helps to screen well and set expectations with tenants :-) ) And we have some trades to call upon for repairs. These rentals cashflow about $150-250 per house - some are lower because we were able to pull out most of our capital via cash purchase and delayed financing. I raise rents 1.5-3% each year and when our north Tacoma house tenants moved to another of our rentals last month, I increased rent from 1125 to 1250 with ease. My suggestion would be to look at Sno and Pierce and maybe south King with agents and property managers in those areas, analyze listing they send you to be more familiar and do your own marketing. Lease options could help turn properties from non-cashflowing to cashflowing.There are definitely opportunities outside of our immediate areas but you will want to check out the health those markets.

@Michele Fischer Thanks for the tips!

Great Thread!! I will try to be brief, which is tough for me when talking Real Estate... The last 2 duplexes were purchased from the bank for about 75% FMV after $10K in repairs. Both were brought to me by my Broker. Pavel, the best couple hints I can give would be to first spend the time and research to develop a specific business plan for your goals and resources. Secondly, would be to network & network some more to find a couple really good RE Brokers who work primarily with investors and then treat them like gold!! I sit down with my brokers at least twice a year to strategize and recalibrate (if necessary) what we are targeting. And third... look where most people are not. Competition is everywhere, of course, but work with your Broker to determine areas that are largely being overlooked. Newer duplexes in Pierce County, until recently, were a great example. Andrew, I say Gig Harbor because this is a place a Broker has pointed me. I am only looking for SFR's or maybe a townhome. What I like is that there are many newer, clean areas (built 2004+), it's not too bad of commute to Tacoma or Bremerton, etc. and I am told that rental demand, for these newer areas is strong... which, I believe will transfer to a strong buyers demand in 5-10 years. Just need to find the right deal. Mitch, the new duplex is in Spanaway and probably just 5 miles from you. I would love to meet you there sometime to chat and show you around the place. Tiffany, are you looking in downtown Tacoma at all? If so, I would be interested in hearing what you think. Good Luck All!!

@Pavel S. I would need to know more about what numbers you are working with in order to suggest recommended areas. Personally, I am looking at Pierce County, as I have found a couple of investment properties that both cash flow and are affordable. However, I know some people have found luck in the Everett area and Skagit county (as has been mentioned before). I look for multi-family units that are close to colleges and universities. There is automatic demand between the students and professors. Downtown Tacoma is gentrifying. Between the hospitals (which provides an annual influx of residents from out-of-state), three colleges and the light rail, I see a lot of potential. I am sure @Brandon Turner would have great advice about the Greys Harbor and Montesano areas as well. I am not sure if you saw this, but he is speaking at the Washington Landlord Association Conference this Saturday. Here is the link: http://www.biggerpockets.com/forums/521/topics/131119-washington-landlord-association-conference---brandon-turner-speaking I think the conference would be worth attending if you can make it.

Hi Pavel, It depends on your goals... For pure cashflow, I love multi-family in Pierce County. I just closed on my 2nd duplex last Friday and after 10K and 2 weeks of rehab it should cash-flow the same $1K/mo as the first one. For appreciation with a little cash flow, I am looking into Gig Harbor along with Mill Creek, Edmonds and Mukilteo to the North. Seattle and the Eastside are simply too expensive for me now. I am looking forward to hearing what other WA State investor have to say.