All Forum Posts by: Jake Alger

In my opinion, I don't think she's being ethical to begin with. If she's juggling multiple offers, she should either 1 - remove herself from representing any buyers and refer them out to another agent (can take a referral fee) or 2 - have a managing broker or someone licensed within her firm handle the negotiations directly with her seller (with all offers being sent to that person). Thus, removing herself from ever seeing any of the offers and giving her the ability to represent a buyer as well.

If it's a newer agent, they likely don't know what to do and thus you're getting the weird responses. If it's a seasoned agent (which I doubt in this circumstance), they seem shady and I wouldn't do business with them to begin with.

Just my 2 cents.

Hi @Alain Defrance,

Welcome to BP! Every market has different strategies that work best for their locale.  Pairing up a market with what interests you is what I believe you're looking for.  In our market (Seattle area), house hacking has become very popular as a way of keeping down monthly bills while still owning an asset and capitalizing on market appreciation, because of the rising cost of living here.  Other areas within WA such as Wenatchee and Spokane work very well for pure rentals.

With out of state investing, make sure you have a team or someone you trust to manage or at least stop by and check out the property you own.  The time and cost of getting to an out of state property, should you need to be there for any reason, is something you definitely want to consider within your planning!

Hope this helps. Always happy to chat should you have any questions!

Hi @Kirsten Crotts,

In our market house hacking is something that's becoming more and more prevalent as the prices continue to increase.  I've worked with quite a few clients this year who's plan was exactly that.  Purchase a home, rent the rooms to keep expenses low, all while gaining 100% of the appreciation (whether forced or market) because their name is the only one on the property.  It's a great way to keep your monthly living expenses lower and allow you to use those saved funds for other expenses or investments.  Down the road, you can use the property to leverage into other investments as well.

BRRR is a different strategy and unless you have someone that can check in on the progress of the rehab portion, it can be very difficult. That's property why when talking to lenders they've given you a "stay local" vibe. Contractors are notorious for blowing timelines and budgets, and it gets far worse when the client can't keep them on task. Hard to do from hundreds or thousands of miles away.

Hope that helps :)

Hey @Alexander Reid,

Welcome to BP!

Multi-family and ADU/DADU's can work great in our market. Rentals will always be strong in our area, especially with the contracted tech workforce that migrates in and out of the region. IMO, 2 bed 1 bath are superior to 1 bed 1 bath as it allows more flexibility as to rental demographics (people can have a guest bedroom, an office, a kids room, etc.).

Sounds like you're looking to build. Are you looking for vacant land and meeting with builders, or looking to buy something they already own in a complex, short-plat, etc? Or are you open to looking for something already existing?

A lot of what you plan to do will be heavily dependent on budget, especially location. Be careful if buying within Seattle city limits, it's not very landlord friendly. Rules and regulations are always changing and more so in the benefit of tenants. Everywhere in the current times is going to have some form of modified COVID/eviction rules, so I wouldn't make that a sticking point to location. There's a lot more questions I'd be asking first.

Lastly, a true house hack with a single family home would be my guidance for most. The upside with appreciation is going to be much greater than a duplex where you're tied to rent-roll when you sell (think it'll most likely sell to another investor later).

Happy to chat should you have any questions. 

Hi @Alan Mills,

I'm sorry to hear that your transaction is not as an enjoyable as it should be.

First the disclaimer: I'm not an attorney, so don't take the following as legal advice.  

Items that aren't tangible to the home or affixed are always very difficult to negotiate as part of a Real Estate contract and as such, are usually left out of the contract in practice. Including them can become a slippery slope for holding up transactions because of people's dissatisfaction, which is hard to quantify. We try and keep things as black and white as possible for this reason.  Ultimately what's agreed to on paper is what's most likely to hold up in a court proceeding or mediation.

If it was advertised as part of the listing, one would expect the Seller to stay true to their word regardless of what's written in the contract but unfortunately that's getting rarer now-a-days.  The Real Estate Agent could be somewhat to blame and could have done it intentionally, but my guess would be that it was an oversight.  When we act as a "dual agent" (as it's called here in WA) or a "transaction broker" as you put it, we have certain responsibilities to both parties that revolve around ethics, fiduciary responsibility, disclosure, etc.  For some brokers, they should never act as a dual agent, and if I'm not mistaken, in some states it's illegal (but don't quote me on that).

Do you have some grounds to argue it should be done, absolutely, but that recourse would come after closing and likely through some form of legal action, which probably isn't worth it.  Outside of bringing it up with both parties (agent & seller), there isn't a whole lot you can do at this point.  Obviously I don't know the ins and outs of your contract, so take what I'm saying with a grain of salt.

Not that this really bares mentioning at this point, but always hire a good broker to represent you.  I know that may be a little biased being that I am a broker, but having someone acting on your behalf as a fiduciary can very much limit things like this from happening.  Brokers/agents who do a lot of deals each year have been through and seen a lot.  I've closed millions of dollars in transactions and even I'm surprised by some of the things people try or neglect on behalf of their own clients.  On the buy side, an agent doesn't cost you anything (99% of the time), as they're paid ultimately by the Seller.

I apologize for the book of a response, but I hope this helps guide you in a direction that makes this misfortune sting a little less.  I would just have a conversation with the broker and see if they or the Seller are willing to make things right somehow.

Best of luck!

Hi Allen,

I’ve closed cash deals in as little as 3 days. It really depends on if escrow can get the lender payoff in time (if there’s a current mortgage on the property). Sometimes getting the payoff takes a week or so.
If your offer price is less than what the outstanding mortgage balance is, it would become a short sale and the lender would need to sign off to release the lien because they’d be taking a loss. Short sales usually take a long time to close because of the red tape of needing approval from the bank.

Hi @Martin Krimmel,

What price range are you looking at? Are you trying to stay within Seattle proper or willing to go north/south?

I haven't seen direct effects of delayed closings just yet but Title & Escrow have been swamped. Our MLS also just released a specialized addendum adding flexible closing dates should it be required due to circumstances outside of anyones control (i.e. shutting down recording offices, etc. because of the virus).

Hi Greg,

In short, the answers to your questions are Yes, Yes and No. It sounds like you came across either a lazy agent, someone who doesn’t frequently work with investors (most agents don’t), someone who has a poor understanding of providing exceptional service or someone who doesn’t feel you’re in a serious enough mindset to purchase (doubt it’s the last one, just letting you see the whole field of view from an agents perspective). That said, I could be absolutely in the wrong as I have no clue who this person is. What I do know from being an investor friendly agent is that regardless of if the buyer is retail or an investor, my job is exceptional service, a strong emphasis in certain areas of expertise, protection of my buyer and their interests and helping guide them to the right homes, not just blanketing them with every house that’s on the market. 

Further, I don’t “drip” on people, sending them every home under the sun. I look at every alert that comes through and hand pick what to send to my clients. Sometimes you can get some really interesting properties that bare absolutely no interest to your clients caught up in their alerts. 

You can absolutely account for condition through pictures, previewing the home in person, calling the listing agent and asking questions/getting clarification, looking at Seller Disclosures, past listing history, price ratio to comparables in the market, etc. All of that gives you a pretty decent idea before you even walk in what the property is going to be like. Not every agent will do all of these things, but in my experience (and maybe I’m biased because I’m an agent), the good agents who do, earn the business and the future referrals. They also tend to have the most respect for their clients interests.

Hey @Alexander Knox,

Welcome to BP! As you mentioned, most of us are here because we love Real Estate and all it affords.

Both of the scenarios you put in front of us are each different in their strategies.  The first being that it would be solely an investment property, thus requiring a higher down payment and in turn, you'd receive a return on your money in the form of cash flow and appreciation.  Obviously being a CPA, you realize that you'd also have a tax implication for the income.

The second scenario, you open up many other lending programs which give you the ability to purchase a home for less money down.  Doing this you could "house hack" your way into a stronger equity position by renting out rooms, or if that's not your thing, at least you're investing the principle each month into something you own and is likely to appreciate over time.  This beats putting money into your landlords pocket at a 100% loss rate, instead of the partial principle pay-down you'd have paying a mortgage.

Depending of where you'd be willing to look for properties, $60-$70k down would be more than sufficient (depending on what loan program you use and the price of the home).  Areas south of Seattle that are booming like Kent, Renton, Des Moines can trade in the $400k+ range.  North, you can find some properties in Shoreline, Lynnwood, Bothell, etc. at lower price points as well.

That said, strategy and willingness are everything.  The market has been heating up in our region since January and with the Fed cutting rates today, it's likely to get crazier (more buying power for buyers).  We are also sitting on record low inventory once again, so the supply/demand imbalance is once again present.