Cashflowing Properties in Western Washington

[Jake DeAtley]

Hello BP friends,

I've been extremely laser focused in on trying to get into real estate investing this year and have a goal to buy a good cash flowing deal before the end of the year. Ideally a 2 to 4 unit in Thurston county, however I would be willing to get into surrounding counties and/or single family if the deal was right. I've been using various websites and tools to look for deals, but we all now the MLS is really hot right now. Is it just me, or are the only potentially decent cash flowing properties (at least on the MLS, Redfin, Zillow, etc.) in Grays Harbor County?  I generally go by the 1% rule as a first test, and almost nothing meets that criteria in Thurston, Mason, Lewis, and Pierce counties. Thoughts? Has anyone bought a good deal on any of these websites recently?  I definitely need to start getting more creative.... Hmmm

I appreciate anyone and everyone's input!

Key Words: Washington, Greater Seattle, I-5, Tacoma, Olympia, Tumwater

[Curtis Bidwell]

@Jake DeAtley Welcome to South Sound real estate 2017.  Yes, the market is HOT.  My apartments are renting 12% over last year.  I just rented a 3 bedroom townhome 14% over the past tenant.  I'm getting ready to rent another 3 bed townhome 24% over the previous tenant!  I can't wait until the next 'old tenant' gives notice!  I'm pushing rents $200-$400/mo over previous residents.  While I have a hard time justifying jacking rent $200/mo on my existing tenants, I certainly have no problem bringing an empty unit to full market. 

All that to say... you need to find something that will "cashflow" at current rent, but know the market well enough to know what rent "should be".  Then calculate your 1% rule on that.  Most smaller landlords are afraid to push rents to market, so finding something under market is not tough.  (My apartments average over $50/unit over my neighbor's identical units! I even GAVE her a prospect this week for a $1050 unit, and she rented it to them at $995!!)

Most of my properties over the years were purchased at about a "0.7 Rule" (didn't even know the 1%, 2% rules!).  But today they cashflow very nicely.