All Forum Posts by: Bisrat Arega

I relate to your question so much. I think we can make assumptions but there is no way to get a definitive answer. The same way that in 2019, No one could have predicted covid and the effects it would have on the housing market in 2020. Like Jon said, it is unprecedented. We can speculate but we won't know forsure until it all falls one way or another. But I do think that we cannot apply an existing economic model to explain what will come next. With the current government, growing national debt, low interest rates, and still high unemployment, literally anything is possible.

1 Vote

@Axel Meierhoefer

Im curious was well, I’ve thought about this strategy. Glad to hear it’s working for you!

1 Vote

Originally posted by @Annie Johnson:

I just posted a zoom meet up for January 1st. We meet every first Friday of the month. If you can’t find it I will send you details in a message:-)

Hey Annie, may I also join the meetup?

Thanks

0 Votes

Thank you! It's a very slippery thing to corner down. So here is what I had in mind as far as criteria for my first house hack. Is this reasonable/tangible in my market? I just need a point of reference to tie down my criteria

Criteria

Type of property
1. Single-Family
  1. Split level / ADU / Unfinished Basement
2. Multi-Family
Location
1. Noth of Seattle
  1. 98270, 98205, 98258, 98208, 98037, 98296,
2. South down to Tacoma
  1. 98002, 98001, 98003 98023, 98001, 9802 98047 98354 98372, 98424/ 98402
Condition
1. Light cosmetic rehab 5-8K
Price Range
1. 450-475
Profitability
1. 3-6% CoC
2. NOI / FMV = CAP RATE 6% CAP

2 Votes

Originally posted by @Bisrat Arega:

fellas, so with everything being said above.....does it make more sense to use CAP rate as the primary metric followed by CoC for a market like King county, Peirce, Snohomish

0 Votes

fellas, so with everything being said above.....does it make more sense to use CAP rate as the primary metric followed by CoC for a market like King county, Peirce, Snohomish

0 Votes

Originally posted by @Sherief Elbassuoni:

@Bisrat Arega, I agree with what @Michael Haas mentioned above.

To get this COC you got to either house hack (ADU, finish basement, rent by the room, DADU, ....) or force appreciate the property by doing rehab.

Turn key properties on the market typically will not get you high COC numbers.

Makes sense, I plan to house hack a duplex or split level. Thank you!

0 Votes

Originally posted by @Michael Haas:

@Bisrat Arega CoC is heavily influenced by the down payment percentage - 10-15% CoC is usually achievable around here by house hacking (owner occupying) a property and using a 3.5% or 5% down payment, or using a 10% down "second home" or "vacation home" loan to secure a Airbnb / Short Term Rental.

With 20% - 25% down 12% CoC is not usually achievable for an "on market" rental property deal around King County.

Thanks Michael, really good insight here.

1 Vote

Originally posted by @Eric Huang:

Originally posted by @Bisrat Arega:

@Brandon Sturgill Thank you for that. right now I'm working on getting pre-approved. I'm close but not quite there yet so I don't have any hard figures for you. I'm looking to qualify for around 450K. I have close to 25K saved. the 12% COC return is a figured I snagged from watching Brandon Turners video here...he says these numbers work anywhere you are, but my thing is how the heck can I get 12% in the greater Seattle area and surrounding. I guess I'm not sure how to analyze a deal that works for me if IDK what returns I'm looking for, in other words, I wouldn't know a good deal or a bad deal if they smacked me in the face!

@Bisrat Arega I'm exactly going through the same process. Run numbers for practice by picking a few properties in the south (Tacoma, Fife, Federal Way) or up in the north (Edmond, Everett, etc.) from zillow or redfin. Tweak selling prices, rent, repair, ...and from what I play so far, it's hard to get + cash flow on paper. I think the key is to get deal and be creative in creating additional values to the properties and reduce the costs while renting out.

Hey man, Id love to sync up and run numbers together. I really want to learn and no better way then to practice, practice, practice. It will also help better define my criteria

0 Votes

Originally posted by @Brandon Sturgill:

@Bisrat Arega COC is elusive, relative, and arbitrary...I guess what I mean is that the formula is simple on paper, but in practice it grows legs...and to be honest, 90% of the figures people are bragging about awesome cash-on-cash returns are far from reality. Focus on the out-of-pocket heavily and transparently...most folks go wrong with not understanding the true costs associated with the deal...resources to get it under contract...closing costs...holding costs....and the cost of renovation.

Do you have some of the numbers handy from your deal you could share?

This is great...Thanks!

0 Votes

All Forum Posts by: Bisrat Arega

Bisrat Arega has started 3 posts and replied 15 times.

Post: How can this market continue seeing such highs?

Post: I love my Turnkey Investments. BP is skeptical. Am I just lucky?

Post: North Seattle REI Meet Up

Post: COC in king county WA

Post: COC in king county WA

Post: COC in king county WA

Post: COC in king county WA

Post: COC in king county WA

Post: COC in king county WA

Post: COC in king county WA