All Forum Posts by: Justin Frank

@Kiera Underwood

It really depended on the area. The big expense and in my opinion crazy overvalued big markets like Seattle, Issaquah, Bellevue, Tacoma and other surrounding popular markets suffered. Homes sales dropped and values were cut in half. Smaller markets that didn’t have as much of an appreciation spike didn’t suffer as much. Thurston county neighbors a large military base so the market in that area faired fairy well given what was happening everywhere else. With all that being said, I was not investing at the time. I was in college and feeling like “oh ****, I am never going to get a job Regardless of my degree. What the hell am I in school wasting my money for.” Lol. Someone who was investing in Washington state may have a more accurate answer. I do know that a lot of people who were able to purchase in 2011/2012 made out like bandits. In most areas Home prices have nearly doubled since that time. I wish I was aware and had the investor mindset during those times. I do remember wanting to purchase a home on a small lake for $383k which seemed so expensive at the time. If I had it today that same home would be worth $800k+. Crazy 😀

@Daniel Alzate,

As a lot of others have stated, I would take a peak at the tax assessors value of the property and see what taxes currently are. I would take what @Ian Stuart said and pay close attention. Property taxes are one of your biggest expenses. 

Hi @Robert Harpster

This deal sounds okay at best. If you purchase at $165k and you can raise rents to $750/unit you cash flow will be decent but one thing I would consider is that you are trapping $30k of your own money into a 1200 sqft building that was built in 1946. Did you consider lead paint, old plumbing, old water pipes, how is this building heated/cooled, and how old is the heating cooling? Where is the building located? This can make a huge difference in whether or not this is a good deal. $165k in the Seattle area i would do all day long regardless of my previous mentions. $165k in Eatonville I may walk away. Also, i always ask what your goals are? Does this match your goals? It doesn’t fit with mine. I don’t want to own a small duplex built in 46. Unless it was in the middle of a booming city. Hope this helps a bit. If you have more specific questions feel free to ask. It’s always hard to give an opinion when folks post a few numbers and want to know if it’s a good deal. There is so much more that goes into it. Good luck. 

Hi @Matt Bertsch, I am in SS. It’s a great investment. SS is much more of a retail business in comparison to MF but still a great investment and I will continue to invest in storage. Understanding how to underwrite any piece of real estate is probably way too detailed to try and post in this thread. I would recommend searching YouTube. Plenty of good stuff out there. Get in touch with @Scott Meyers, or @Michael Wagner. They offer a lot of info specific to SS. 

@Kiera Underwood, @Michael Judd

I do agree with you Kiera. $100k will go a long ways in many other states. With that being said, another way of looking at your statement could also be that it only takes 1 property in Washington to get the value of 5 properties in OKC. It really depends on what your goals are. What works in one place for one person may seem silly or crazy to another. 

@Michael Judd

I live in the Thurston county area and have properties in pierce, Thurston, and Lewis county. There are great deals to be had all over the state, they are just very hard to find and SFRs are very hard to get cash flow out of. Prices of homes in our area are too high in comparison to rents. Pierce county is very tough. High home prices and the highest property taxes in the state. Thurston county is a little better as far as the homes prices go but in my opinion it is still too high to make sense unless you are willing to live without your 20% down for a long period of time. The other problem with Thurston county is inventory. There is none. Homes in the $200-$400k range are bid up and under contract within hours. Houses over $550k are sitting but they make zero sense if looking to own as a rental. You can still find some decent deals in Lewis county. Lots of old homes that needs lots of work. if you put in the time and money you can find a decent rental there. I am looking to invest heavy in the Lewis county area. I think it will have a decent amount of appreciation sometime after the next downturn. There is a huge demand for rentals in Thurston and pierce county. Unfortunately to get the right purchase price you have to get a bit out in the woods where the rental demand fizzles out. I don’t know much about the east side of the state so I can’t give much of an opinion. I do know Spokane is getting rather expensive and I have interest in Moses Lake 😀. There are deals out there. Just be patient and work your butt off to find something that you can get your hands on before it goes to market. Good luck. 

Hi @Spencer C.

Hard to form a true analysis on the deal you are presenting. There just isn't enough info. To answer your questions. If you want to find out about an area I would recommend talking with agents, property managers, and businesses in the area. What info are you looking for? That may help you determine who you need to talk to. One of the big questions I would have is why is the facility less than 50% occupied? Is there a demand issue, access issue, visibility problem, bad marketing, mismanagement? Also, what is the current NOI? You didn't list an actual purchase price but you have listed that you are purchasing at $10.8/sqft and the facility is 26,400sqft so I am assuming your purchase price is just south of $300k correct? Hard to give an opinion on expenses when I don't know how much activity/revenue is being generated each month. Your "thought" on market rents is listed in your post. How did you come up with these? Is this a guess or have you called around to other facilities in the area? You don't not want to guess what rents would be. You want some actual facts. What are the local facilities renting at? you have zero experience in storage what is your management plan? Storage is a great asset but is very much a business in comparison to MFs

Keeping things very basic. If you are purchasing for less than $300k, the facility is in good shape, and there is a heavy value add and with a total of 283 units. I would buy it. I am in the storage space though. If you want more help or info send me a DM. If you decide to walk away from this property send it my way 😀. If it fits my criteria and I can move forward I will give you a commission. Good luck. I hope my post will help you a bit. 

@Gary R Uren

I have one remaining property in Klamath Falls. This area is kind of like the Midwest. Old homes, good purchase price points, rents are good, and not much appreciation. I don’t think I will continue to invest in this area just because I don’t think it will ever see much growth due to its location. If there was some multi family that came up I would consider it. What are you looking for? What do you need help with?

Hi @Jerry Lucker,

I sent you a PM. Hoping to talk with you about your current investing strategy. 

Good point @Jack B.