All Forum Posts by: Kyle Anderson

Hi all,

I've been lurking around the forums for a while and trying to pinpoint the best way for me to get started investing in real estate. I think I have it nailed down to two potential strategies and I'd like to get some input/advice from people with more experience and market knowledge than I have. Some quick background on my current situation: I moved to the Seattle area back in July with my partner and we rent a 2-bedroom unit in Capitol Hill for $1995/month + electricity and internet. Our lease expires in August 2019. I have about 26k stashed away specifically for a down payment and contribute an additional 1.5k every monthly paycheck to this account so I'm estimating 38k in savings by the time our lease expires. My ideal plan would be to purchase a home (something I could house hack) on an FHA loan with 3.5% down and live there for 2 years, at which point I would purchase a second home on an FHA loan and move there while keeping the first property as a rental. The long term plan would be to repeat this process until I build up enough capital that waiting 2 years between property purchases no longer makes sense and then transition to a new strategy.

However, there are things about the Seattle area that concern me regarding the feasibility of this option. I've read that Seattle is a difficult market to cash flow and I don't want rental properties that I have to contribute to monthly just to meet the mortgage payment. It also seems like decent multifamily properties in the area are often outside of what I can afford (these are strictly observations based on Zillow/Redfin -- I have not connected with an agent at this point so maybe I'm mistaken). On top of this, I've heard that Seattle tenancy laws tend to strongly favor the tenant so renting properties here might not make the most sense.

I'm torn about how to move forward. I wholeheartedly intend to purchase a live-in property after our lease expires because 2k/month down the drain hurts. I like the strategy I described above in another market but I'm just not convinced it will work in Seattle. The alternative would be to buy a decent SFH (still on FHA) and stay there for a while to gain appreciation. In the meantime, I'd try following a BRRRR strategy in out-of-state markets where property is much cheaper (i.e. 38k could be a 20% down payment instead of 3.5%) and cash flow is more accessible. Naturally, there are down sides and hassles to this approach, too, but I think it might be more realistic. I'm still very early in my real estate journey and largely unfamiliar with the area so any feedback on how to proceed would be greatly appreciated. Cheers!

Hello Bigger Pockets Seattle! I'm a recent college grad who just moved to Seattle to start a new job and I've been doing a lot of reading about real estate investing lately. I'd like to try my hand at it but I'm both new to the idea of investing and new to the area so I'm not sure what the best place to start would be. I've heard that it is difficult to cash flow in Seattle (and tenant laws can be troublesome) but it's more feasible in surrounding areas. I've also read that Seattle is a great place for appreciation but even the cheapest properties I've seen in the city are 400K+ and it makes me nervous to start with that expensive of a purchase since I don't have any experience yet. I suppose I'm essentially looking for advice on what you would do if you were a brand new investor looking to get started in Seattle/surrounding areas. I'd also be happy to network with anybody interested in sharing some of their knowledge -- the more I can learn, the better! Thanks in advance!

Thanks for the quick responses. @Curt Smith I've looked into FHA financing and it seems very intriguing but there's one part I'm confused about. After doing some research, it seems that I could qualify for FHA financing with 3.5% down payment on my first home purchase, but I'm concerned about the following snippet: "If you've lived in the home for at least one year, you're allowed to move out and turn it into a rental property without breaking the FHA rules. You won't qualify for a second FHA loan, except in special circumstances, such as outgrowing the home or moved farther than commuting distance." Is it possible to continue buying homes on FHA loans after your first one? If so, how? If not, would it be advisable to take out a HELOC against the first home to either use towards buying a rental property or buying a new primary property and converting the other home into a rental? Any advice is appreciated!

I'm just beginning to explore my options in real estate and I'm interested in identifying ways through which I can generate some (ideally passive) income using my primary residence. I'm currently renting an apartment in downtown Seattle but I'm trying to save/build credit to buy a home at some point in the future so advice regarding properties both owned and leased is welcome. One of the first things that came to mind for me was renting out private rooms (through subleasing, Airbnb, etc) to help reduce my monthly housing expenses. However, after doing some research, I began to stumble upon other interesting strategies -- for example, I came across a discussion in which somebody was renting out space in their home to a group of people that wanted to use the space for mining cryptocurrencies. This got me thinking about strategies I can use to maximize the income-generating capacity of the place I'm already living in, so I'd love to hear about any creative approaches other investors have had success with in the past!

Hello Bigger Pockets!

My name is Kyle and I'm a 23-year-old recent college graduate moving from my home state of Iowa to the Seattle area in two weeks for work. I'd like to give a little background on myself as well as where I envision the future taking me. I'm a software developer by trade and I've been fortunate enough to obtain a high-salary job right out of college with a sign-on bonus that has allowed me to pay off my student loan debt, meaning I have a clean slate (debt wise) to enter the "real world". I have a little bit of money saved up (roughly 15k or so) but I've never invested in anything before and my credit is mediocre. I would consider myself a very goal-oriented person, and while I enjoy the work I do, my next goal is to acquire enough wealth-generating assets to offset my expenses in an effort to become financially independent from my career. Since graduating in May, I've turned my attention towards learning to invest and I'm hopeful that I can use the Bigger Pockets forum as both an educational and networking tool.

I became interested in real estate after stumbling across some YouTube videos a few weeks back and have been falling further down the rabbit hole since. I'm a terrible handyman so I'm not very interested in flipping homes that need a lot of renovation. I'm also slightly intimidated by the concept of being a landlord (again, largely because I'm awful at repairs -- I don't know the validity of that hesitation, but I'd be lying if I said it wasn't there) so I'm really intrigued by strategies which avoid or minimize that responsibility. From what I've read, these options can range from simple solutions like hiring a property manager to more complex deals like sandwich leasing with tenant responsible for repairs, but I'm open to any other alternatives with which people have had success.

Another concern I have is the market I'll be living in. Seattle seems to have a booming housing market right now and property prices are expensive (at least from my frame of reference, which is small town Iowa). While I definitely see the merits of owning property in a market with so much growth, I'm nervous about the amount I need to begin investing -- I don't want to make a stupid mistake with my first property and be on the hook for half a million dollars when I could have began investing in cheaper properties elsewhere to gain experience. I realize that living in Seattle doesn't necessarily mean I'm required to invest in Seattle, and this is probably even more valid if I hire a property manager to oversee my investments, but I like the level of comfort afforded by the ability to go and physically see the property I've put my money into. Any advice on beginning to invest and avoiding pitfalls in an expensive market (or investing in areas outside of your physical area of residence) would be warmly received. 

I'm new to investing and I have some tolerance for risk due to my discretionary income and unindebted financial state. With that said, I want to be smart with my money and make sure I'm setting myself up for as much success as possible. I'd like to establish a realistic and goal-driven strategy to begin my endeavors in real estate investing and I'm appreciative of any advice or insight people might have to offer, particularly in light of the aforementioned points of friction.  I look forward to becoming better acquainted with everyone on the forum so don't be afraid to say hello!