Looking for first investment property in Seattle and need advice.

[Evan Anderson]

Hi,

I'm 22 years old, living in Seattle and looking to invest asap in either a SFH or multiple units... I hate renting. I have about $36k in liquid savings and just got preapproved for a $332k conventional loan at 4.875% interest. I know that's not a lot in Seattle, but it paints a picture for my buying power.

So my question is, do you think I should start investing this year or hold off? Seattle is extremely competitive and it’s virtually impossible to find market deals with positive cash flow. So I would basically be investing in the gain on appreciation/reversion. And if I was to do this, even an investment in a condo then might make sense. Can someone with more experience paint a clearer picture for me on what makes the most sense? Thanks!!

[John Barrett]

@Evan Anderson you certainly can get started but you need to be careful that purchasing does not put you in a tough position financially. I would make sure that your quoted interest rate will not increase if you choose to put a lower down payment.  While you can use low money down options for purchasing your first property, this will result in higher recurring monthly mortgage payments.  It's not a problem, just something you need to plan for.

Do your research on any areas that you plan target. Given your budget, it will limit some areas near Seattle. However, you can find properties in Tacoma and north of Seattle in the price range you have listed. There are pro's and con's with each property type and different strategies for each regardless of what type of property you are looking at. House hacking with roommates maybe easier to start with given that the prices for multifamily properties are high at the moment. You may also be able to find a condo that will meet your criteria, just be cause of the HOA fees.

Best of luck with your investing.

John