All Forum Posts by: Caleb Webster

Hey Sarah,

I'm a local agent and rental property owner in Portland and work almost exclusively with investors and house-hack clients. I've represented several clients in the last year who have bought duplexes and helped them navigate the Portland rental laws as well as find creative ways to increase cashflow. I'd love throw my name in the hat if you're still looking for an agent.

@Basit Siddiqi I just switched CPA's actually so I'll pose this question to him, thanks for letting me know though! This would definitely change things for me.

@Sean Ade Definitely consult with your CPA but I think you may be on the hook for 50% of the capital gains if you sold since only half of the property was considered your personal residence. I was house hacking 4 out of 5 bedrooms in my PR and my CPA said that I'd have to pay 4/5ths of the capital gains if I sold. 

That was meant to be a response to @Eric Berkner, not Michael

@Michael Dumler cap rates might be that low for A+ assets in great neighborhoods in Portland but there are still deals at 6+ if you’re willing to go further East past I205.

Cap rates are tied to investor risk tolerance and debt is cheap so risk is less — therefore cap rates compress. The benefits to a low cap market are the returns on value add are magnified. Cash flow might be more challenging but wealth was never really made through cash flow anyways, I’d argue that the only purpose of cashflow is the servicing of debt.

@John Clark does rent control crush value or increase it? In my observation, most cities with rent control have actually seen the biggest appreciation because of the limited supply that rent control often causes.

@Stewart Hulick I've been telling all my client's to do this! I think there's a great opportunity here because of how restrictive short term rentals are, especially now that you can build 2 ADU's on most properties.

@Blaine Gobler Welcome to BP! Your story sounds pretty similar to mine, I bought my personal residence 3 years ago and rented it to my brothers and a few other people while living there. It's such a great way to dip your toes into investing and I've encouraged countless people to get started that way. 

I'm not a lender so I'll avoid weighing in on your first question. I can however point you in the direction of a few great lenders if you're trying to figure out where to start.

The market is definitely crazy but it's showing signs of returning to a bit more of an equilibrium. You can't really evaluate a rental in the future without making predictions about what rents/expenses/interest rates etc will be then. Rents might be higher 3 years from now but your taxes could go up 10% too or your vacancy rates could go up or any number of other things that are impossible to foresee. Rather than trying to predict what might be a good investment in 3 years and risking buy a bad deal now, I would focus on figuring out what makes a good deal now. As someone who underwrites  dozens of properties a week, I can tell you that there are still good deals to be found. 

Since you're making this your personal residence for a few years, start with what is important to you and your brothers. What part of the city would you be ok living in? Do you each want your own room and bathroom? Do you want a big backyard? Do you want it to be turnkey or are you ok with doing some repairs? Once you answer these kinds of questions, you can then start to figure out whether or not you can also make it a good investment. If not, then you need to go back to the drawing board on your strategy because it may be incompatible with your preferences. Does that make sense? 

I'm always down to grab coffee if you want to chat more!

Hey @Ashley Casimir Vasnaik, welcome to BP and an early welcome to Portland!

Small multifamily's in Portland aren't as prevalent as much of the midwest but they still exist, I actually just sold one a few weeks ago. Portland just passed a law allowing for 2 ADU's on any property which essentially lets you turn any single family into a duplex or a triplex if you're willing to put in the work. I've found that with this strategy, you can actually achieve pretty healthy cash flow in a market where that is normally tough to find. You can also supercharge that by Airbnbing one or both of the ADU's since you'll be living on the premises and therefore can avoid the restrictions around short term rentals.

For investors that are willing to get creative and think outside the box, opportunity abounds here. If there’s anything I can do to help on your investment journey, shoot me a DM! I’ve made a thousand mistakes over the years and I want to make sure the lessons I’ve learned from them will help others.

I love wallpaper accent walls and have always wanted to do one in a property but I'm wondering if it will make future rental turnovers more expensive/challenging since we would probably have to replace the wallpaper if there was any blemish or damage. Has anyone done something like this in a rental property? If so, what was your experience? Do you regret it?