All Forum Posts by: Mike Nuss

Ha, It's a small world. That's awesome. Look forward to meeting you...

Hey @Jay Hinrichs thanks for the "bus tour" shout out. We thought about adding a zero or two to the price, but thought that may put us in the "guru" bucket.....a place we do not want to be!!! It should be a good value (our first one so we'll see). We're going to physically go in 5 properties (two with our contractor, one with a designer) as well as a bunch of other properties/projects we've completed. 

Come check out some of our meetings. All "non ********" willing to share, network and talk RE are welcome. We would love to have your experience there and I'm sure you'll find some rehabbers that would like to JV on some deals.

We moderated the "developers" meeting, not the deal analysis. We launched RareBird in June. Anita and Courtney shut their meeting down in July and Anita has been co moderating our RareBird deal analysis meeting since. Jim Lerman also shut his Roundtable meeting down and has been moderating our "local expert forum" meeting. 

David Scott was throwing out the idea of having a lending panel come talk at the local expert forum sometime in the future. Would you be interested in being on that panel should we decide to do it?

@Rusty Thompson call Toija Beutler at Beutler exchange. She's a local exchange "guru". You can exchange into multiple properties with those properties totaling at or above your resale price. The key there would be getting that right amount of new debt and how many loans that would take. You have a track record now of managing your properties so current rental income should be able to be part of your debt to income ratio. 

That's a very solid portfolio @Rusty Thompson in a short amount of time. Especially considering you're located in Oregon and the difficulties of Urban Growth Boundaries boxing you in a bit. I've seen you post in other threads at looking in more Rural areas of Oregon, rather than Portland to create cash flow. I wholeheartedly agree that there should be good opportunities for cash flow in outlying cities due to better rent to price ratios.

You've basically replaced your salary (prior to the raises over the past two years) since you begun. The 8plex seems to be the biggest obstacle to growing your empire further. Being that the 8plex a) has equity b) has a high interest rate and c) is your biggest time factor.......maybe considering a 1031 exchange with that property would be in line. That would be one difficult exchange to complete. In my experience finding sellers that can wait for you to handle other moving pieces, prior to closing, can be done. Maybe get some direct mailing campaigns going to SFR home owners. Getting some negotiations worked out on exchange properties, prior to selling the 8plex, may help you with that time crunch the exchange will create.

Just my 2cents, but freeing up your time from managing that beast could potentially be the key to growing your cash flow, diversifying your portfolio and aligning your properties to what you've found to be your best niche (SFR).

Hey @Ben Eiesland my partner and I have started a new investment association in Portland. We moderated meetings at the Northwest REIA for two years prior to starting the RareBird Investor Network. We add an educational twist to the networking platform and it has been getting raving reviews from the members. 65 members after 4 months and it is quickly growing. Come check us out. We host 3 meetings a month (1-3rd Mondays at Lucky Lab in Multnomah Village) and have a group of members doing deals on a daily basis in the Portland market.

http://myrarebird.com/events/

Chris, congrats!!! Fun stuff. You're correct that in Oregon, if they've lived in the unit for over a year you have to give them 60 days notice to vacate. @Lucas Bennett is right on. Communication with your tenants is a better way to go than just coming up with an idea in your head (based on your perspective) and then implementing a plan. You may find that your tenants know their rent is way under leased and are willing to take a rent increase in exchange for a new lease. I had that scenario this year where the tenant was at $900 and wanted comfort in knowing she could stay for the next school year. We initiated a new one year lease at $1,100, with pet rent and more demands on her for upkeep of the property. $200 may not be a lot to an investor, but it definitely is to a tenant. In our Portland market that $800 on a 4plex, assuming a GRM of 150, creates an additional value of $120,000 (or $192,000 based on a 5 cap) so even small increases can greatly affect market value of the property.

I know I hate to move so moving just to get earlier occupancy seems like a lot of hassle to justify higher rent in 60 days versus 90 days. 

A great investor attorney for Portland is Gary Kahn @ Kahn, Reeves and Hennessey. Their office is on SE 52nd Ave.

Hope this helps,

Mike

Awesome neighborhood. Good job!! ADU definitely help turn the #s back in the landlords favor for Portland.

@Johnathan F

Great news. That didn't take long at all. Which neighborhood?

Speaking of Birds.....

James, I highly recommend staying west of I-205. You'll find higher cap rates (6+) east of I-205, but management will be more difficult, vacancy rates will be higher and appreciation will be less. The prime areas of Portland have been going bonkers. I used to pencil our rentals at $1.25 per sq. ft. I'm now using $1.50 per sq. ft. for penciling and the market has been paying us much higher than that with two units in Hawthorne close to $2.00 (we buy older buildings). New construction varies depending on location, but new construction is $2.00++. Small micro units are even getting close to $4.00. Portland defines what you're looking for. A tiny bit of cash flow with solid appreciation. 1% rule is almost non existent here so cash flow is tough, but it is possible. 

@Paul Spangler, welcome to BP.

I rarely see the 1% rule in Portland, it just isn't that kind of a market. That being said, my partner and I (as well as others I know) have been and continue to purchase cash flowing properties in this seller's market. It's all about direct marketing and getting face to face conversations with sellers. Interest rates are still very low so buying an owner occupied 2-4 unit property would probably make a lot of sense right now. 

Come check our RareBird Investor meeting tomorrow (Monday). You'll be able to meet investors and industry participants of various levels. We use the upper banquet room at Lucky Lab Pub (Multnomah Village location). 6:30-9:30. This is our deal analysis meeting. Anita Borgaes (previous REIA moderator) and I (also previous REIA moderator) will each be going over a recent deal on power point. Then we open the room up to the white board to analyze what the group may be interested in. Very good networking opportunity.

http://myrarebird.com/events/