All Forum Posts by: Jack B.

Quote from @Henry T.:

Reject. At the size of your posts I'm sure you know what youre doing screening wise, high credit scores, high qualifications, job length, 3x, and so on. Bullet proof lease with LOTS of rules and clauses. I've been doing this game over 30 years now. Seattle has turned toxic. I'm closing doors and presently rehabbing to sell out. Seattle landlording is dead to me. 1st in. $10 late fee. Unlimited occupants. Can't evict family with kids in school. Winter eviction ban. Ridiculous "just cause". Today they're voting on 5% rent cap. THEY just dont quit. Why deal with the anti-landlord environment? If you're younger I'd suggest you get out and go to a landlord friendly state where you have some rights and less stress. Good luck Jack!

 My rentals are close to Seattle but in the surround burbs, Renton, Maple Valley, Auburn, Federal Way, the list goes on and on....but I hear ya. When the market drops again and rates are low, I intend to 1031 my entire portfolio out of state, possibly to Idaho. They still have good appreciation, but aren't socialist.

Quote from @Nathan Gesner:

Set standards and uphold them. I don't recommend the first applicant because you'll have to go look for another replacement in a few months. The second tenant may be perfectly fine. He asked for a carport, you said no, and he accepted your answer. That's not a terrible thing if he meets your other qualifications.

I'm a little concerned that you would write an applicant off because of a question. The more important factors are his ability to pay rent, maintain the home, communicate, etc.

The first applicant would pay a higher rent due to being a furnished mid term rental. The second wasn't written off due to the question, here's more context. He showed up in an 120K Audi, but wanted to haggle on rent and get me to buy him a carport. Well, in the real world, when you drive that kind of car and expect your landlord to PAY for your parking setup because you don't want it to rain on your car, that's an obviously entitled person. ON top of that, he later asked for a month to month lease. I explained I would charge a higher rent due to the shorter nature of the lease. He balked. So basically, he wants everyone to provide him everything while he gets the best deal out of the situation, month to month lease at no extra charge, parking carport at 2K, etc. He can afford to buy his own parking cover. If it's HIS vehicle he is concerned about, HE should pay for it not me...

I tried ABNB out with one of my rentals last year and am converting it back into a long term rental and also trying mid term rentals until I find a long term tenant. 

Applicant A: Mid term. Travel nurse and her husband plus dog (I don't like dogs and usually don't accept them). They would rent for 3-5 months at 2K a month. It left a bad taste in my mouth that they tried to negotiate the rate down so they could pocket more of the 4K a month the employer is paying for their lodging....plus he's an insurance adjuster so I worry about him trying to pull some kind of "injury" scam while he is here.

Applicant B: Long term. Entitled grown man. Asked if I'd be willing to buy a carport for his parking spot at my expense. I'm like, ugh, no.

Or....option C is I keep it as a short term for now and give ABNB another try this summer. It was booked solid last summer. I'm getting inquiries from insurance companies for my place too, 7K for a 50 day stay...but no deal yet.

So would you rent to Applicant A? Or?

Quote from @Lauren Kormylo:

I haven't had any luck yet renting my 4 bedroom house on FF.  If you look at this article, https://www.nomadicare.com/travel-nursing/7-things-you-have-... you'll see that travel nurses are paid a per diem amount, and they try to get something cheaper so they can pocket the difference, that's why they're cheap and try to bargain with you.  It has a link to GSA.gov, scroll to the bottom of that site and you'll see a calculator for per diem daily lodging rates for your area.  That's the max that a nurse could get, and may get less, so your place may be way too expensive for them. Furnished Finder recently announced that now half of their customers are not nurses, but people looking to relocate or need housing while their home is being remodeled or repaired after being damaged. Those would be more likely to be your ideal guests. 

Thank you!! Yeah the last nurse I talked to even tried to negotiate it down. I had to tell her she is insane. You can't rent a room for what she was asking here in Seattle, let alone an entire place furnished on a short term lease! 

Quote from @Jamie Banks:

In my portfolio, we get ~50% of our leads from Furnished Finder throughout our portfolio in 5 markets. There are some leads that don’t match our product, but we reach out to each one to start the conversation. Apart from Furnished Finder you should be listing on other sites like Airbnb, VRBO, and Zillow.

 I already am. My point is, this doesn't seem to be an effective market for FF. Seattle is one of the most expensive markets in the country and I get a lot of inquiries from people from BF middle of nowhere where the rent is $600 a month. Then they come here and want an entire place to themselves, furnished, on a short term lease and on a lake with AC, etc for the price of a car rental....An entire house on my lake rents for 6K a month...

I think a lot of these travel nurses can't afford expensive markets or just don't want to pay. They keep saying they want a place to themselves, no room by room. Yet my gf rented a room when she moved here for $1,500 a month...a room....a ROOM. These travel nurses don't seem to understand economics and that they are not going to move from an area where you can buy a house for the price of a VCR to rent an entire house furnished for less than an apartment is here....

All I get is email blast messages from travel nurses who all want to rent an entire lake house by themselves/no room mates but their budget is $1,500 a month. Are these people smoking crack? You can't rent an apartment in the ghetto for that price here, let a lone an entire house....on a lake...furnished...for 3 months.

Then of course I have ONE bite from a sane travel nurse...and her WFH husband...and their pitbull. None of which fly with me. 

Are people having success with this mid term rental stuff renting by the room or something? If so to whom? 95% of that site is travel nurses and they ALL seem to have a water budget but champagne taste.

Quote from @Henry T.:

I have an exit plan to get out of Seattle(toxic), but tangible real estate is the best plan to keep generational wealth. If the kids want to sell after I kick, fine, but hopefully they will see the light. If you have it now, keep it, because obtaining real estate in the future will not get easier.

 Brother, Seattle and the surrounding area are practically radioactive wasteland....

Quote from @K S.:

Quote from @Henry Clark:

Quote from @K S.:

Quote from @Carlos Ptriawan:

Quote from @Bill B.:

@K S.

$20k/mo far exceeds my expenses already. 

 when did you make your first purchase ? KS and Bill ?

Ok I thought Bill meant 20k/year not per month which is more than enough to retire but to put things into perspective, accoridng to the historical S&P 500 calculator, I could have acheived the same results as Bill with just $1M invested 16 years ago. Pulling just 5%/year of the 5M today is around 20k/month (and would still increase in value). That would net me aproximately the same cashflow as Bill but for absolutely zero time in. Despite the nuiances, I prefer the latter which is why I'm stopping at 10 properties after this build and will sell off some in retirement as streamlining your life becomes more important. I don't find it "fun" as others say to rent out houses you've never seen and will never live or vacation in. I would get rid of the rest and convert them into a steady income streams. Diversification is better anyways and some investments like your 401k can't be taken in a lawsuit. 

I have plenty of colleagues that retired and soon to retire off their 401k and other market investments with millions at the same age as you guys but without the tenants, mortgages, lawsuites, maintenance, always searching, offering, closing and renovating, cpa headaches etc.

 Totally agree with you $1mm investment versus $1mm investment I would rather do stock bonds. 

But not included in the $20k per month is the appreciation value during that period also the leverage at point A.  Most people don’t start with $1mm in savings at point A.  

Real estate will always beat stocks bonds because the government set it up that way. 1031, 2 out of 5 primary, writeoffs, sweat equity, ADU value add, STR, MTR, etc. You can do options on stock but you can get calls. Not in houses if you're making payments.

Plus the best thing of all is when you fail in REI it's your fault.

I did add the appreciation value. My rough estimate is that both investments would work out to be near the same in the end. True, most wouldn't start with 1m. I think dolar cost averaging would net 3.2m so not as good but also, not everyone in RE did well either. 

I do like the new ADU laws but everything you mentioned is still what makes RE not truly "passive" hence why I would sell in retirement. I woud sell time waisting properties in retirement to help streamline your life to add time for things that make you happy. If finding strangers to move into a house you've never seen, will never live in or vacation in is ones idea of "fun", then great but why not transfer homes into federally insured vehicles, some of which are protected against creditors and lawsuits. I haven't found any good answers other than I like landlording and stop being a hater.

 What federally insured vehicles are you referring to? Treasury bills? CD's?

Quote from @Leo Young:

No, the plan is to "buy and die", because the tax code in the US incentivizes this the most. 

If you scale up to a point that it's too much hassle, then hire out someone to help, a property manager or even an asset manager. 

Had to reply to this. While optimizing taxes, ROI, ROE, IRR, and all the other wiz bang math is great...is that the tail wagging the dog? I would think life is about QUALITY of life, not how to pay the least taxes when you die...

Which is really what this thread is all about, what is your goal with real estate and does it involve an exit from it? I guess for some, they need to scale so they can have the private jet lifestyle ASAP. Others just want enough to not work and are ok with getting the jet slowly. 

Some I guess will never get tired of dealing with tenants or property managers (I've had to manage my recent trial of one this past year, they sucked). If I trusted the stock market, even an index fund tracking the S&P500, I'd probably keep the RE I have and focus more on investing in the stock market, but alas, I don't trust it, and most people I've met don't either. Yes, time in the market is key, but most, myself included, have had a tendency to gamble on stocks, lose our money and never truly hold. Now I'm trying big name companies and holding. So far so good. If it works out, I'll grow that more so I'm not as tied to managing rentals. The thing about rentals is, you're always exposed to risk of lawsuits more so than just being an everyday Joe.

Quote from @Leslie Pappas:

Quote from @Jack B.:

Or have you? 

A woman I recently dated also has a rental portfolio and retired in her 30's. She met a lady in California who told her as you get older you won't want to deal with the hassle of tenants and rentals or PM's, and you'll want to sell like I did. I agreed with her and so did the girl I was dating for a few months at that time. 

So that begs the question, do any of you have an exit plan? Opportunity zones? 1031 into DST? What?

Hi Jack, 

Here's a post I made about helping a client "exit" the landlord stage of his life. I've worked with many investors who sought a life style change and wanted to take a more passive role in their real estate.

https://www.biggerpockets.com/member-blogs/7993/48729-are-yo...

 A very convenient advertisement for your business, not actually adding to the thread in any way.