Renting a SFH in Millcreek WA

[Roger Garner]

Hi everyone

I own a SFH in MillCreek, WA. I am moving out of the states and I am in a fix whether to sell or rent the property. I am hearing a lot about tenant issues, washington state laws favoring tenants etc.

What is the communities general consensus on managing rental properties out of state ? Is it worth holding the property for long term appreciation ? 

[Rachel Kokosenski]

Hi, Roger! I've got experience with investing in rental properties while living far from the state the properties were in and I think the key to being successful with it lies in having a property management company you can trust to handle the day to day issues. Finding a great property manager is not always easy, however! 

I recommend visiting your local REIA (Real Estate Investor Association) to talk with other landlords, property managers, and other investors in attendance. It's always smart to talk with others active in your market to get a real understanding of the local situation.

But, don't assume that because other owners have had good success with someone that you should automatically go with that company. I would recommend you interview each PM to understand what they charge, what their systems are for management, etc. Then, choose the best of those you interviewed.

Appreciation is a good thing in real estate. Historically, even though the markets dip down sometimes, real estate is generally moving upward in value over the long haul. 

Lastly, I don't know what your long term plans are, but having a house to return to in the States if your international adventures don't work as planned can be a good safety net for you!

[Roger Garner]

Thank you @Rachel 

@Rachel Kokosenski !

[John Barrett]

@Roger Garner there are many factors that go into the decision of whether or not to keep your property as a rental.  For example: your current interest rate, rental rate, expectation for appreciation, tax benefits, leverage and inflation protection.  While all of those are necessary to think about, none of these matter more than figuring out what goal you are trying to achieve.

From your post, it appears that this is your former primary residence.  There are tax advantages for selling your primary where you can claim capital gains tax free.  That alone could be worth between $250-$500K.

I personally like holding properties, but you may not want the hassle.  Decide on what you are trying to achieve and then determine if holding the house makes sense.  There are solutions to the challenge of managing your property.  You just have to figure out if that's what your goal really is.

John

[Gabriel Graumann]

@Roger Garner Hey Roger, and fellow former Mill Creek resident! I was born and raised in the Mill Creek area, and owned a few properties there for several years. When we opted to move to Phoenix full-time, we opted to sell our property for a few reasons. Primary reason was as you already stated, that tenant laws in WA heavily favor tenants when compared to other states across the country. We chose to limit our liability, especially coming out of the pandemic situation by rebuying a rental closer to where we'd be in a market more favorable to landlords, so we bought in the Phoenix area. That said, long-term the appreciation you get in the Puget Sound region is superior to many other markets, so assuming you find an excellent property management company that is able to screen tenants and only put in very well qualified, vetted occupants and you experience limited issues over the holding period, you'd likely come out ahead retaining the Mill Creek property if your financially able to do so and still buy wherever you are headed out of state. Happy to connect on this as I'm still actively brokering deals (commercial) in Washington all the time and I'm frequently traveling up there to view properties and meet with other brokers. I have some fabulous broker relationships that serve the Mill Creek market if that's a need also.