All Forum Posts by: Mike Nuss

Check out this interview with Owen Gabbert and Shane Boland giving their advice on becoming a full time investor! 

https://www.youtube.com/watch?v=kFRXeOL9Mw8&feature=youtu.be

I highly agree with @Neal Collins. Selling now in this area would be similar to selling on Division pre 2012. Allowing your own opinions, rather than the opinions of buyers as a whole, drive your buying/selling decisions is a poor mistake for a real estate investor. It doesn't matter how you feel, it matters how the market as a whole will respond and Fo-Po and Lents are poised to become great appreciation plays. 

@Jason Fleming that isn't a bad basket to put those eggs in, in my opinion.

Infrastructure investment in this area also makes much more sense than east of I-205 for many reasons. 

1) Infrastructure is already in place and it is a connecting road for two areas (Powell Blvd up to 52nd and Lents town center) already in progress of gentrification. Development here is much less costly than "east Portland"

2) Foster has a great mix of historic storefront product along this section, good development land and the width to become a really nice urban village district. 

3) It's one of the most affordable neighborhoods that is still bike-able to downtown. 

4) This area will become a highly desirable neighborhood once the commercial development comes to fruition. Where else will Portlanders find this amount of single family housing, with the type of walking amenities it will have, still relatively close to downtown (no matter how much longer than new drive will take you) and at a price point that's open to many (until that changes). 

@Account Closed does he have the new investment property identified? If so, maybe the title company can wire the money to the other escrow account. We've done that in the past, but it was the same purchasing entity as was the selling entity and it wasn't across state line. Just a thought in case it's helpful. 

@Kevin Jorgensen I think the masses are less worried about an actual downturn/crash because the financials of 2018 are very different than 2006. Lending has been much tighter, building supply much slower (although speeding up past few years) and the market has a different kind of demand (as well as effective purchasing power of that demand). I've been saying the market will slow down for the past two years. It did a bit the past year, we're no longer the top 1-2 appreciating markets in the top 20 MSA (per Case schiller), but values have still been going up, just at a lower rate. 

You definitely have reason to pause. Affordability is declining (and only gets worse as rates rise while prices continue to rise) and the tech sector seems to be slowing a bit, but migration is still happening and the financial basics of Portland are very strong.  

@Jordan Moorhead if someone is blocking others (especially competitors) from a meetup, I would assume there is an agenda that will be pitched. My experience with meetings that are run by an agenda pitching person, or team, has typically been a waste of time. 

In regard to starting a new REIA. That's exactly what we did with the RareBird Investor Network. In fact @Jay Hinrichs was one of our first few speakers. We go the complete opposite direction as the local REIA. No sales. No pitches. Only local speakers doing local projects. Lot's of networking. Little BS and great collaboration. That works for some, but not for everyone. We've grown substantially over the past two years and just until the past month we grew strictly from word of mouth (as well as a lot of good shoutouts on BP). 

We just held a networking mixer two weeks ago where we marketed it on BP as well as meetup. We did offer free wine and beer and light snacks. About 90 people showed up and it was really just a big happy hour with people interested in real estate. Our monthly meetings are where people go to learn and do. 

If you're serious about wanting to start a new REIA.....dm me and I'll be happy to share with you what's worked for us and what hasn't. Good luck!

Hi @Amanda Coleman I have quite a bit of experience with airbnb and have done a tone of research. I think I can provide some value to those questions. So here we go....

First off, what is your zoning? That will determine what you need to go through. If you're in a residential zone, there will be limitations that you need to deal with. The "accessory short term rental" code variances are for residential zones. You can get a lot of answers by going to the city of Portland website  https://www.portlandoregon.gov/BDS/65603

The fees, process and timeline are all answered well on the city website. Hotel taxes are a requirement. Airbnb manages the taxes directly (taking from guests and paying to city) and VRBO just started doing that as well. 

Regarding your 4br house.....bigger isn't always better if your goal is to have an airbnb. There is a 2br limit for the "type a" permit. You can do more bedrooms as well as commercial gatherings with a "type B' permit, but type b permits are much more costly and difficult to obtain. I don't know anyone with a type b permit. Yes it is legal to rent a house you don't live in, to an extent as there is a 270 day occupancy requirement for a permanent resident; which really means that you can only rent it as a "whole house" for 95 days out of the year (I may have those days flip flopped, it may be 275 and 90). ADUs have slightly different requirements, where you can have full time residency in one structure and then full year astr in the other. 

Going back to the zoning question.  Nightly rentals are allowed by code in commercial zones with an occupancy change. The occupancy/use change is a longer process than any of the astr permits, but it can be rewarding for the right property. We have a 4plex in a commercial close to the Moda Center and Convention center. Ultimately we went the occupancy change route to create a boutique "hotel". Our building fills a very specific niche, so it has been successful. 

I highly recommend doing this above board. Fines have increased within the past year and now range from $1,000 to $5,000 per fine. One owner in town finally gave up fighting the city and sold a building they were breaking the rules with. They ended up paying something like $72,000 in fines. On top of the fines; short term rentals are a controversial topic in Portland. 

All in all, I would do it again for the right property, but I won't consider doing it in a residential zone. Theres too much controversy, too much regulation and too much supply in residential zones. Managing a nightly rental is a ton of work that either requires time or high management fees. That typically doesn't pan out in a residential zone (or at least not well enough for the headache in my opinion). 

Hopefully this helps. I gave a pretty lengthy presentation on the truths, myths and such for nightly rentals at a recent RareBird Investor Network meeting, so feel free to ask more questions. I'll be happy to help if I can provide value. 

Have a great weekend!

@Matthew Powell

Kyle Pearson at Pearson-advisory.com sounds like a great fit for you. He's focused strictly on services for entrepreneurs. He cut his teeth working for a large nation wide investment firm. He's been handling all of our accounting needs for almost a decade now, as well as many other real estate agents/investors in town. He's lined up to be a speaker at one of our upcoming RareBird Investor Network meetings as well (I think July) so you can come see his accounting chops in person if you would like. 

@Jay Hinrichs thanks for the shout out. That means a lot coming from you!

@Alex Nelson posting here is a great start. Meeting other investors face to face is even better (and as Jay said, our RareBird Investor Network meetings are a great way to do that). Partnering can be risky and I highly recommend not doing that on a long term hold(or even cycle hold for that matter) with limited experience. You're in a great position coming out of a cap gains tax free proceeds. Learning on a flip is a great idea and probably a faster way to get a good ROI than a rental. However, profit from flips cannot be exchanged (legally) so you'll have taxable proceeds at the end (assuming all goes well :) ).

The great thing about real estate is you have a ton of options (read opportunities). The bad part about real estate is that you have a ton of options (read distractions). It's definitely a double edge sword at times, but that is not a bad thing. Keep meeting and networking with other investors and eventually that right opportunity will pop up and you'll be ready to take advantage of it. 

Good luck!

@Account Closed check out Lucas Gray/Propel Studio in Portland. They've done a lot of adu work in town....small buildings are right up their alley. 

@Jay Hinrichs enjoy Hawaii!

ps, Thanks for sending their weather our way, very much appreciated :)